At closing, Confederation transferred to Magna its interest
in American Potash in exchange for 22,420,000 common shares
and 2,400,000 common share purchase warrants. Each warrant
entitles Confederation to purchase a further common share at
a price of $0.10 until February 25, 2016. Concurrent with the
transfer, Confederation subscribed for 6,666,666 common
shares of Magna at $0.30 per Share for gross proceeds to
Magna of $2,000,000.
As a result of the transaction, Magna now holds a 100%
membership interest in American Potash LLC., which holds
certain potash leases and an option in respect of certain
potash lease applications in the State of Utah. With the
share and warrant issuances on closing, Magna now has an
aggregate of 51,506,666 common shares and 4,800,000 common
share purchase warrants exercisable at $0.10 per share issued
and outstanding (on a non-diluted basis), of which 56.47% of
the shares and 50% of the warrants are held by
Confederation.
Rudy De Jonge, President of Magna, stated "This acquisition
consolidates 100% ownership of our very exciting potash
prospects into Magna Resources allowing for more focussed
management and easier funding which will benefit all
shareholders. I believe we have the most advantageous land
position in the Paradox basin, the largest known Potash basin
in America. This consolidation of ownership is also very
timely because we expect shortly to have satisfied all
requirements necessary to begin drilling our first test
hole."
Lawrence Dick PhD., P. Geo., President of Confederation,
stated:" the Magna transaction is a win-win situation.
Transferring all of American Potash to Magna Resources, which
is now
56.47% owned by Confederation, allows our company to focus on
our Newman-Todd gold
exploration project, in the prolific Red Lake gold camp,
while maintaining our major position in the
highly-prospective potash holdings in Utah, for which we have
exceedingly high expectations. The potash prospect will be
taken forward under the care of a geological team with
experience in the potash field, and will allow Confederation
to give this project the geological attention it
deserves."
All securities issued by Magna at closing are subject to a
four month hold period expiring
May 20, 2012.
Magna is also pleased to announce that American Potash LLC
has submitted Potassium Prospecting Applications in respect
of an additional 2253.95 acres of BLM land contiguous to its
existing applications in Utah.
- 2 -
On Behalf of the Board, Confederation Minerals Ltd.
"Lawrence Dick"
Lawrence A. Dick, Ph.D., P.Geo
President, CEO, and Director
On Behalf of the Board, Magna Resources Ltd.
"Rudy de Jonge"
Rudy de Jonge, CEO and President
For further information, please contact: Magna Resources
Ltd.
Rudy de Jonge
CEO and President
(604) 782-4191
CORPORATE INQUIRIES Confederation Minerals Ltd.
Suite 1980, 1075 West Georgia Street
Vancouver, B.C. Leo Karabelas
1-416-543-3120 leo@frontlineir.com
www.confederationmineralsltd.com
This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address events or developments that the companies expect to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the companies believe the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include failure to complete the conditions of the Purchase Agreement. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the companies' management on the date the statements are made. Except as required by applicable securities laws, the companies undertake no obligation to update these forward- looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.
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Magna Resources Ltd. and Confederation Minerals Ltd. Complete Purchase and Sale of American Potash LLC |