08/14/2019 | Press release | Distributed by Public on 08/14/2019 10:10
As a result of the cease trade order, the TSX Venture Exchange suspended trading in the shares of Rosita and conducted a reinstatement review. Several outstanding filings were completed and a comprehensive press release is provided herein expanding on previous disclosure to ensure that all market participants are clear on that status of the business arrangement amongst the Company's wholly owned subsidiary ALR Nicaragua SA ('ALR') and CXB Nicaragua SA ('CXB'), a wholly owned subsidiary of Calibre Mining Corp., and Century Mining SA.
The Century Mining Development Agreement
Alder Resources Inc., the predecessor to Rosita Mining Corporation, through its wholly owned subsidiary ALR, originally acquired a 65% interest in the Rosita copper-gold-silver supergene/skarn/porphyry project in Nicaragua located 275 kilometers northeast of Managua (the 'Project' or the 'Rosita D Concession') from Calibre Mining Corp. pursuant to an option agreement dated August 29, 2011 (as amended August 23, 2015) in consideration of expending $4 million and issuing 200,000 shares of the Company, both of which were completed as of October 3, 2015. As a consequence of fully earning its interest under this option agreement, Calibre Mining Corp. and ALR immediately entered into a joint venture agreement dated September 2016 with an effective date of November 23, 2015. Pursuant to that joint venture agreement, Rosita will earn up to an additional 30% interest upon expending $7 million. Under this arrangement, Rosita has acquired an additional 5% interest, by virtue of the dilution formula to hold, as of December 31, 2018, a 70% interest. This option agreement continues to operate until CXB interest in the Project is reduced to 5%.
As previously reported by press release dated October 25, 2018, ALR entered into a joint venture agreement dated for reference as of October 11, 2018, (the 'JV Agreement') amongst CXB and Century Mining SA, pursuant to which it was agreed to establish a new private Nicaraguan company to be known as Santa Rita Mining Company SA. ('SRM'). SRM was established on November 1, 2018, is the operator of the Project. It has its own staff and uses technical input from other members of the JV. Details of the JV Agreement are detailed below.
Principally the JV Agreement provided that ALR would contribute its 70% interest in the Rosita D Concession and CXB would contribute its 30% interest in the Project as well as all its business knowledge respecting the Project. Century Mining SA was obligated to advance USD$1.5 million to SRM by December 16, 2018 in order to acquire a 13% interest in the Project. In addition, SRM could acquire an additional 62% in the Project by advancing a further USD$7 million within 90 days of the advance of the initial USD$1.5 million, being October 10, 2019. As of the July 12, 2019, Century Mining has advanced approximately USD$1,600,000. Notwithstanding that this payment was late, both ALR and CXB are willing to continue to honor the original agreement.
The initial US$1.5 million investment into the Project by Century Mining was slower than anticipated but sufficient funds were contributed to keep the Project proceeding satisfactorily. For example, the continuing treatment plant engineering process, carried out by the Project's independent engineers, D.E.N.M. Engineering of Burlington, Ontario ('D.E.N.M.') with additional metallurgical testing by SGS, was completed and a suitable engineering procurement construction (EPC) team contractor is now being sought. D.E.N.M. were the principal authors of the PEA as described and disclosed, in Rosita press release dated April 20, 2017. This PEA also summarises the SART (sulphidization, acidification, recycling, and thickening) metallurgical process, to recycle cyanide and recover cyanide soluble copper. Testwork has been undertaken and disclosed for this PEA by SGS Lakefield (one of the leading metallurgical test laboratories in the world and incidentally the original inventors of the SART process), who are the Project's independent, certified testing laboratory with locations world wide.
The EPC will be contracted to a team supervised by SRM. It will include D.E.N.M. but other appropriate disciplines will be used.
At the mine site, the plant site was cleared and the tailings disposal site is being prepared. Engineering meetings at site discussed equipment placement. For general education, SRM and D.E.N.M. engineers visited the nearest operating SART plant in Mexico. D.E.N.M had played a large role in the design and construction supervision of this plant. It is anticipated that a similar plant will be used for the Project.
As at July 12, 2019 approximately $US 1 million has been spent on the Project with another $US 0.6 million available in SRM's Nicaragua bank account.
In addition the Rosita D concession has been transferred to SRM as outlined in the October 25, 2018 press release (available at www.sedar.com). Likewise technical data, in particular that relating to the treatment plant has been transferred to SRM by Rosita.
John Cook, President and CEO of Rosita Mining has been spending more than 50% of his time in Nicaragua to assist supervise the technical aspects of the Project and follow the technical aspects summarised in the October 25, 2018 press release.
Rosita is satisfied with the progress made by Century Mining in advancing the Project to date and looks forward to Century Mining continuing to advance the development of the Project.The TSX Venture Exchange has conditionally accepted the JV Agreement, subject to the Company filing further documentation usually required in similar situations, including a satisfactory legal opinion and copies of the Rosita D mining concession transfer.
Proposed Name Change and Share Consolidation
In other news the Company confirms its intention to change its name to King Global Ventures Inc. However, the Company is no longer planning a share consolidation, as previously announced in its April 4, 2019 press release.
Reinstatement to Trading
Rosita expects that trading in the Company's common shares on the TSX-V will reinstate on August 16, 2019.
For further information, contact John Cook, President of Rosita Mining Corporation at: (416) 200-8073 [email protected]
Cautionary and Forward-Looking Statements
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain information in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of the Company, including but not limited to, the uncertainty of the financing, the impact of general economic conditions, industry conditions, dependence upon regulatory approvals. Readers are cautioned that the assumptions used in preparing such information, although considered reasonable at the time of preparation, may prove imprecise and undue reliance should not be placed on forward-looking statements. This cautionary statement expressly qualifies forward-looking statements in this press release.
The forward-looking statements in this press release are made as of the date of this press release, and the Company undertakes no obligations to update publicly or to revise any of the included forward-looking statements, whether because of new information, future events or otherwise, except as expressly required by applicable securities law.