Mexican Gold Signs Definitive Agreement to Acquire Tatatila Project in Mexico

Executive Summary

• Mexican Gold Mining Corp. entered into an Assignment Agreement to acquire 100% of the Tatatila mineral title (3,824.36 ha) in Veracruz, Mexico from Chesapeake Gold Corp. and its subsidiaries.
• Consideration will be 4,451,361 common shares of Mexican Gold (valued at $0.05 each, total deemed value $222,568), representing ~15% of the post‑transaction equity.
• A net smelter returns royalty of 1.5% will be granted to Chesapeake Mexico, with a buy‑back option for Mexican Gold to reduce it to 1% by paying US$500,000 within ten years.

Key Details

• Interest Acquired: 100% title and rights to the Tatatila Project (3,824.3585 ha) surrounding the Las Minas Project.
• Consideration Shares: 4,451,361 common shares @ $0.05 per share → aggregate deemed value $222,568; will constitute 14.99% of Mexican Gold’s outstanding common shares after issuance.
• Royalty Grant: Net smelter returns royalty of 1.5% to Chesapeake Mexico.
• Buy‑Back Option: Mexican Gold may purchase 0.5% of the royalty for US$500,000 within ten years, reducing the royalty to 1%.
• Share Hold Periods:
• Statutory hold period – 4 months from issuance.
• Additional lock‑up: on each anniversary and every six months thereafter, 25 % of the shares released; full release after 2.5 years.
• Closing Conditions: Subject to acceptance by the TSX Venture Exchange and customary closing conditions for such transactions.
• Strategic Rationale: Tatatila surrounds Mexican Gold’s Las Minas Project and contains several skarn prospects, potentially extending the existing resource base.

Notable Quotes

(No direct quotes were provided in the release.)