BonTerra Resources (CVE:BTR) said Wednesday it has inked an amended agreement with Abitex Resources to immediately acquire a 100 percent interest in the mineral claims in the Bailly and Barry Townships in Quebec, known as the Eastern Extension property.
In consideration for the 100 percent stake, BonTerra will issue 1.25 million shares.
The new deal amends the option agreement between the two parties from September 2010, and reduces the cash component of the consideration. Closing is subject to the approval of the TSX Venture Exchange.
The property is subject to a two percent net smelter returns royalty, one percent of which can be purchased for $500,000.
Under the original option agreement, BonTerra had the right to earn up to a 100 percent interest in exchange for making cash payments totaling $110,000, issuing a total of 1.35 million shares, and incurring a total of $750,000 in exploration expenses on the property over four years.
To date, BonTerrra has paid $10,000, issued 500,000 shares and incurred $750,000 in exploration expenses.
The amendments to the deal reduce the cash payment obligations by $100,000 and increase the share issuance obligations by 400,000 shares, BonTerra said.
"This is a rare opportunity for BonTerra to reduce the cash component of the option agreement for the Eastern Extension," said president Navjit Dhaliwal.
"It is always our goal to focus our expenditures on our ongoing drill program in Quebec rather than elsewhere due to the high quality of the Property.
"BonTerra management decided to rush the exercise of the option in order to own the Property outright subject to the NSR. This amendment to the agreement highlights the partnership and goodwill BonTerra has been developing with our neighbors in the Urban-Barry gold camp, in this case Abitex Resources."