VANCOUVER (miningweekly.com) – Alamos Gold has agreed to enter into a subscription agreement with fellow Canadian resource company Corex Gold to obtain financing for Corex's Santana project, in Sonora, Mexico.
The total financing of $2.83-million will also be used to settle certain outstanding Corex indebtedness and for general working capital purposes.
Corex will issue 25.3-million common shares to Alamos at a price of $0.10 apiece, while also providing Corex management the option to subscribe to a further three-million shares at $0.10 each.
Corex has granted Alamos the right to nominate up to two directors to its board.
Further, Alamos has received a participation right to maintain its pro rata share ownership in company at up to 19.99%.
Pending certain conditions, the transactions are expected to close concurrently on October 20.
Corex owns 100% of the 7 700 ha land package, located 50 km south-east of Alamos Gold’s Mulatos mine. Corex has been exploring a multimillion-ounce epithermal gold deposit at Santana, which, according to the company, is amenable to openpit mining and heap leaching.