Fidelity Minerals Corp (CVE:FMN) announced Tuesday revised payment terms in relation to the sale of its Cerro Dorado gold plant in Peru.
The company noted that to further the US$1.43 million sale agreement announced on October 1, 2019, total payments made by the purchaser have totaled US$500,000, meeting the conditions of the sale through to March 2020.
As a result of COVID-19 related regulatory delays and disruptions, Fidelity Minerals said it has been working with the purchaser to negotiate amended payment terms for the remaining US$930,000.
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On October 9, the company said it executed an addendum to the original sale-purchase agreement, with a revised payment schedule. The revised payment terms for the outstanding balance is outlined below:
- US$100,000 on October 10, 2020
- US$100,000 on November 25, 2020
- US$100,000 on January 25, 2021
- US$310,000 on April 25, 2021
- US$320,000 on July 24, 2021
Following the execution of the addendum, the payment scheduled for October 10 has been received. Importantly, the revised terms require accelerated payments to be made to the company, under certain conditions.
As outlined in the original sale-purchase agreement, in the event the purchaser has missed a payment and this has not been remedied within 15 days, Fidelity Minerals said the ultimate transfer of Cerro Dorado to the purchaser will not complete and ownership of the mill complex, mine and concessions including all improvements and on-property assets will remain with Fidelity Minerals. The executed addendum also incorporates certain financial assurances, and the requirement to provide the company with regular updates.
"The recently agreed, revised payment terms for Cerro Dorado provide the company with increased confidence that the sale transaction will now complete,” said Fidelity Minerals CEO Ian Graham in a statement. “We are pleased to have been able to work closely with the purchaser, to negotiate a mutually agreeable solution, to enable the timely recommissioning of Cerro Dorado, currently scheduled before the end of CY2020.”
Graham added: “In the interim, we are focused on our active exploration programmes, particularly Greater Las Huaquillas, where we are approaching the completion of the reinterpretation of a historical geophysical survey, and Las Brujas, where we have a field crew on-site, performing extensive sampling and mapping. We look forward to providing a further update on these activities shortly."
Fidelity Minerals, based in Vancouver, is focused on assembling a portfolio of high-quality mining assets in Peru through a project generator model that involves the identification and acquisition of appraisal stage opportunities with near-term valuation catalysts.
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