Sandstorm Gold Ltd (SAND)

[Tommy]

Sandstorm Gold Agrees to Purchase Precious Metals From Colossus Minerals

http://www.sandstormgold.com/news/release/index.php?content_id=228

... "Sandstorm Gold Ltd. (“Sandstorm Gold” or the “Company”) (NYSE MKT: SAND, TSX-V: SSL) is pleased to announce that it has entered into a precious metals purchase agreement with Colossus Minerals Inc. (“Colossus”) (TSX: CSI) to purchase an amount of gold and platinum from the Serra Pelada Mine (“Serra Pelada”) located in Para, Brazil.

Sandstorm Gold has agreed to purchase an amount equal to 1.5% of the gold and 35% of the platinum produced from Serra Pelada (the “Precious Metals Purchase Agreement”). Pursuant to this agreement, Sandstorm Gold will pay an upfront cash deposit to Colossus of US$60 million and ongoing per ounce payments equal to the lesser of US$400 per ounce of gold and the prevailing market price of gold, and the lesser of US$200 per ounce of platinum and the prevailing market price of platinum.

“Serra Pelada is a fantastic project run by a first-class management team”, said Sandstorm Gold President & CEO Nolan Watson. “We are confident that the high-grade nature of the Serra Pelada deposit will contribute to it being a low cost producer for years to come.”

As part of the transaction, Sandstorm Gold has also agreed to purchase 35% of the palladium produced from Serra Pelada (the “Palladium Purchase Agreement”) in exchange for paying a US$15 million deposit (bringing the total deposit payment made by Sandstorm Gold to US$75 million) plus ongoing payments of US$100 per ounce of palladium. In addition, Sandstorm Gold has entered into a back-to-back agreement with Sandstorm Metals & Energy Ltd. (“Sandstorm Metals”) whereby Sandstorm Metals has purchased the Palladium Purchase Agreement from Sandstorm Gold in exchange for issuing a promissory note." ...