TORONTO, ONTARIO -- (Marketwired) -- 07/09/13 -- Tolima Gold Inc. ("Tolima" or the "Company") (TSX VENTURE: TOM) is pleased to announce that it has entered into an amending agreement (the "Amending Agreement") amending the terms of the binding letter agreement (the "LOI") with IAMGOLD Corporation (TSX: IMG)(NYSE: IAG) ("IAMGOLD") dated October 4, 2012.
Pursuant to the Amending Agreement, section 4(a) of the LOI will be amended to modify the terms and conditions of the consideration to be paid or provided by IAMGOLD for purposes of exercising the 51% Option (as defined in the LOI), particularly to clarify: (i) that the first US$3,000,000 of Qualifying Expenses (as defined in the LOI) is no longer a firm obligation of IAMGOLD and, therefore, if IAMGOLD decides not to exercise the 51% Option, it will not be obligated to pay to Tolima any shortfall of US$3,000,000 in Qualifying Expenses; and (ii) the final earn-in payment will be either the expenditure of US$6,000,000 of Qualifying Expenses or the drilling of not less than 12,000 meters of Qualifying Drilling (as defined in the LOI), whichever comes first.
As consideration for the entering into of the Amending Agreement, IAMGOLD has agreed to advance Tolima US$354,600 upon signing of the Amending Agreement to cover current liabilities in Marmato Gold S.A. Sucursal S.A. The advance will be considered Qualifying Expenses under the Amending Agreement.
Jaime Lopez, the Chief Executive Officer of Tolima, stated: "We are pleased to have brought in some needed funds to cover current liabilities in Marmato and look forward to the continued support of IAMGOLD in the exploration and development of the ANCAL project. IAMGOLD is actively exploring the ANCAL project with the objective of identifying and prioritizing drill targets for testing later this year, subject to receipt of necessary permits and has invested approximately US$1.7 million, including cash payments totaling US$1.0 million, pursuant to the terms of the LOI."
Related Party Disclosure
IAMGOLD currently holds approximately 13% of the issued and outstanding common shares of Tolima, and is considered an "Insider" within the meaning of the policies of the TSX Venture Exchange (the "TSV-V").
Due to IAMGOLD's approximate 13% share ownership in Tolima, IAMGOLD is also a "Related Party" to Tolima within the meaning of Multilateral Instrument 61-101 ("MI 61-101"), and the Amending Agreement constitutes a "Related Party Transaction" for Tolima. Tolima is exempt from the formal valuation requirements and minority shareholder approval requirements of MI 61-101 since the fair market value of theconsideration received by Tolima pursuant to the Amending Agreement does not exceed 25% of Tolima's market capitalization. The terms of the Amending Agreement have been considered by each member of the board of directors of Tolima and have been unanimously approved. The Company intends to file a material change report more than twenty-one days prior to the entering into of the Amending Agreement. Tolima was not in a position to file a material change report more than twenty one days in advance of the entering into of the Amending Agreement as the details of the transaction were settled on an expedited basis for sound business reasons.
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