Condor Resources Inc. (TSX-V:CN, OTC:CNRIF) said on Thursday its Peruvian subsidiary has signed a non-binding letter of intent (LOI) to sell a 100% interest in the Soledad project in Ancash, Peru, for total consideration of up to $3 million.
Under the terms of the LOI, Condor Exploration Perú granted a local Peruvian company an exclusive 36-month option to acquire the project’s three mineral concessions.
The deal also includes a Cesión Minera agreement allowing the buyer to begin exploration immediately.
The purchase price is structured in installments, starting with a $100,000 deposit upon signing the LOI. A further $500,000 is due upon signing of a definitive agreement, targeted within 75 days, followed by $2.4 million in quarterly payments of $200,000 over three years.
While the buyer may accelerate payments, it will not be permitted to extract and sell products from the property until the option is exercised. Upon completion, Condor will retain a 1% net smelter returns (NSR) royalty, with the buyer also assuming an existing 1% NSR royalty payable to Chakana Resources.
The $100,000 deposit secures a 75-day exclusivity period for the buyer to complete legal and technical due diligence. Depending on the outcome, the deposit may be credited toward the purchase price, forfeited, or refunded in Condor shares.
“We are very pleased to have reached this agreement with the purchaser,” said Condor CEO Chris Buncic.
“This proposed transaction allows Condor to limit dilution and instead focus on its core opportunities of advancing exploration programs at its highly prospective Pucamayo and Huinac Punta projects.”