Magna Signs Letter of Intent to Option Arizona Holbrook Basin Potash Mineral Exploration Permits to Passport Potash Inc.
: Magna Resources Ltd. (Magna) (CNSX: MNA) is pleased to report that American Potash LLC (American Potash), a Nevada limited liability corporation owned 50% by each of Magna and Confederation Minerals Ltd. (Confederation) (CFM: TSX.V), has signed a non-binding letter of intent with Passport Potash Inc. (Passport) (PPI: TSX.V), whereby American Potash will grant Passport an option to acquire the rights to nine potash exploration permits. The permits consist of Arizona State Land Department (ASLD) exploration leases covering more than 5, 800 acres and are 100% wholly-owned by American Potash.
The terms of the agreement are as follows:
A. American Potash will assign the ASLD leases to Passport upon signing of the agreement;
B. PPI will have the right to acquire 100% interest by performing the following:
I. Issuing 500, 000 shares upon the signing of the agreement, that each share certificate shall imprinted thereon a legend restricting transfer in Canada for four months plus one day from the date of issuance of the shares;
II. Paying CDN $30, 000.00 cash within 6 months of the signing of the agreement;
III. Paying CDN $30, 000.00 cash within 12 months of the signing of the agreement;
IV. Paying CDN $30, 000.00 cash within 24 months of the signing of the agreement;
V. Meeting the minimum exploration expenditures as required by the ASLD.
VI. Exploration expenditures on the leases will be paid for by PPI on a 100% basis.
C. The agreement is subject to a 2% NSR royalty with Passport retaining the option to purchase the royalty at the price of US $150, 000 per 1% or US $300, 000 for 2%.
Magnas share of the proceeds upon completion of the agreement will be 250, 000 shares and CDN$45, 000.
On behalf of MAGNA RESOURCES LTD.
“Rudy de Jonge ”
Rudy de Jonge
This press release contains forward-looking information regarding managements anticipated completion of the proposed private placement financing and its anticipated use of the proceeds. The forward-looking information contained in this press release is made based on expectations of management as of the date of this press release and, except as required by applicable law, Magna does not undertake any obligation to update publicly or to revise any of the included forward-looking information, whether as a result of new information, future events or otherwise. By its very nature, such forward-looking information requires Magna to make assumptions that may not materialize or that may not be accurate. This forward-looking information is subject to known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such information. There is no assurance that Magna will be able to raise some or all of the proposed private placement financing.
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