Focus Xplore (AIM:FOX) announced it has signed a sale and purchase agreement to acquire vehicles, Nova Aurum Exploration and 1597320 BC, which together hold five gold exploration properties in Canada.
The AIM-listed minerals exploration and development company first flagged the deal, which has an aggregate consideration of £296,000, through heads of terms announced on 7 September, and has now converted that into a binding agreement.
It noted that the sellers will receive £75,000 in cash and 802.78 million new shares, representing around 10% of the firm's enlarged share capital, as initial consideration; followed by a further 422.51m shares subject to any one of three milestones being met.
The milestones include completion of a phase-one exploration programme across at least two of the properties, identification of at least one drill target, or commencement of a drill programme on any property in the portfolio.
Alongside the acquisition, Focus Xplore has received conversion notices for £37,500 of convertible loan notes issued in March, resulting in 208.33m new shares, and is issuing 27.78m shares to Patrick Cullen as part of his departure settlement agreed in March.
Of the funds being raised, £75,000 will cover the initial cash consideration, £135,000 is earmarked for future exploration programmes, £110,000 will go to creditors, and £188,000 will meet transaction costs and working capital needs.
The company said the creditor payments, combined with shares issued to other creditors under the settlement, will clear all its outstanding aged creditors, leaving its balance sheet in its strongest position in nearly a year.