Kofi Gold Project
On March 31, 2010, the Company entered into definitive agreement with Avion Gold Corporation (“Avion”) to sell the Kofi Gold Project and other ancillary permits in Mali for proceeds of up to Cdn$500,000 in cash and up to 4,500,000 common shares of Avion.
As of the first quarter of 2011, the sale of six out of nine total permits has been completed with a significant tranche closing in December 2010. The payment schedule for each closed sale is in four tranches as follows: 25% on closing, 25% in 3 months following the closing, 25% in 12 months following the closing and 25% in 18 months from the date of closing respectively. To date, AXMIN received 50% of the proceeds from the closing of the four permits in December 2010 consisting of $163 cash and 1,462,500 common shares of Avion and, 25% of proceeds relating to the closing of an additional 2 permits in March 2011 consisting of US$6.2 cash and 56,250 shares. AXMIN expects the remaining three concessions of the transaction to close by the end of the year 2011. This agreement does not include AXMIN’s Satifara permit which was the subject of a joint venture agreement in February 2010.
On February 10, 2010, the Company concluded a Heads of Agreement ("Agreement") with Societe d’Exploration des Mines d’Or de Sadiola ("SEMOS"), a joint venture between IAMGOLD Corporation and AngloGold Ashanti that operates the Sadiola Mine in Mali, whereby SEMOS has the potential to earn 100% interest in the Satifara exploration permit, a joint venture between AXMIN (94.45%) and African Goldfield (Mali) Limited (5.55%). The Satifara permit is located 10 km west of the Sadiola Mine. To earn a 100% interest, SEMOS must spend a minimum of US$500 over a two year period and complete a NI 43-101 Mineral Resource calculation, making payment of US$15/oz for Measured and Indicated, US$5/oz for Inferred resources and US$15/oz for any ounce of gold mineral Reserve mined. The total payment to AXMIN is capped and will not exceed US$7.5 million.