Eurasian Minerals (TSXV:EMX) has entered into three option purchase agreements with Desert Star Resources for the Red Top, Copper Springs and Copper King porphyry copper projects in Arizona. The transaction was made through the company’s wholly owned subsidiary Bronco Creek Exploration.
According to the company’s press release:
Commercial Terms Overview. Pursuant to the three option purchase agreements, Desert Star can earn 100% interest in each of the three Projects, after which EMX will retain a 2.5% NSR royalty. Desert Star has the option to purchase 0.5% NSR of the NSR for US$2,500,000 by the 12thanniversary of the signing date. Desert Star’s earn-in requirements for each Project consist of the following:
- Delivering to EMX 350,000 shares of Desert Star upon TSX Venture approval,
- Incurring a minimum of US$5,000,000 in exploration expenditures by the seventh anniversary of the signing date, and
- Making additional milestone payments to the Company consisting of:
- Advance Minimum Royalty (“AMR”) payments totaling the value* of 220,000 lbs of copper by the fifth anniversary of the signing date and the value of 80,000 lbs of copper annually thereafter until commencement of production, to be credited against 80% of each payment of EMX’s NSR royalty upon production, and
- A payment of $30,000 upon completion of 1,000 meters of drilling, and additional AMR payments totaling the value* of 510,000 lbs of copper tied to completion of a preliminary economic assessment, pre-feasibility study, production decision, and commencement of production. The terms include a payment based upon the known copper reserves at the time of completion of the feasibility study of 0.25% of the value* of each pound of copper up to 500,000,000 lbs and 0.05% of the value* of each pound of copper over 500,000,000 lbs. There are additional AMR payments if project milestones are not met by certain anniversaries.