Alberta-listed Pan East Resources has entered into a heads of agreement with Resource Capital International and Greenstrike Gold Corp. Under the terms, Resource Capital will purchase 555,555 units of Pan East at a co st of $250,000. The units consist of one common share and one share purchase warrant entitling the holder to purchase one common share of Pan East at the price of 60 cents per share for a period of one year.
Greenstrike will agree to expend $500,000 on Pan East’s Nova Scotia properties. Greenstrike will act as operator of the exploration program. It has the choice to fund this program by the issuance of its own flow-through shares and the benefit of Canadian Exploration Expenditures (CEE) will accrue to the benefit of Greenstrike investors. By spending $500,000 Greenstrike will earn 5% interest in the Nova Scotia properties or 715,000 common shares of Pan East in return for the re-assignment to Pan East of the 5% property interest.
Pan East agrees to issue to Greenstrike warrants entitling Greenstrike to purchase 200,000 common shares of Pan East for a period of one year at a price of $1 per share, or Greenstrike may elect to cause Pan East to carry out CEE on the Nova Scotia properties and to issue to Greenstrike common shares at the rate of one common share for each $1.25 in CEE incurred.
Greenstrike Gold Corp. trades on the COATS system and has interests in gold prospects in the Northwest Territories, Casa Berardi and in the Pickle Lake area.
Resource Capital is a newly-listed TSE company, based in Bermuda, which invests in the securities of resources issuers, primarily in Canada.
Pan East has three gold prospects in Nova Scotia — the Fifteen Mile Stream, Mount Uniacke and Killag prospects — all near Halifax.
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