Pacific Gold Corp.-Pilot Mountain Options Project W for Up to $3,000,000
TORONTO, ONTARIO--(Marketwire - Feb. 14, 2011) - Pacific Gold Corp. (PINK SHEETS:PCFG) announced today that on February 10, 2011, its subsidiary, Pilot Mountain Resources Inc. ("PMR"), entered into an Option and Asset Sale Agreement ("Agreement") with Pilot Metals Inc., a subsidiary of Black Fire Minerals of Australia (ASX:BFE), whereby Pilot Metals has secured an option on the Project W Tungsten claims owned by PMR.
The basic monetary terms of the Agreement call for Pilot Metals to pay PMR $50,000 for a 100 day due diligence period on the PMR mining claims. Within the initial 100 day option period, Pilot Metals has the right to exercise an additional 24 month option on the PMR claims by paying to PMR a further $450,000. During the 24 month option period, Pilot Metals may conduct physical due diligence work including sampling, drilling or any other work on the claims it deems necessary.
At any point prior to the conclusion of the 24 month option period, Pilot Metals may exercise an option and election to either purchase 100% of the PMR claims, for $1,500,000, paid as three annual installments of $500,000 each, and an additional $1,000,000 payment to PMR on the commencement of commercial mining operations, or Pilot Metals may elect to enter into a joint venture with PMR for the mining claims by paying a further $1,000,000 to PMR paid as two annual $500,000 installments, with each company owning 50% of the joint venture.
The total amount eventually paid to PMR will depend on Pilot Metals acceptance or decline of the options available. If Pilot Metals elects to exercise the second option and not proceed with the purchase or joint venture then PMR would receive a total of $500,000 but retain ownership of the claims. If Pilot Metals exercises the second option and then further elects a joint venture, then PMR would receive $1,500,000 in total and retain a 50% ownership of the claims. If Pilot Metals elects to exercise the option and then purchase the claims, then PMR would receive $2,000,000 plus an additional $1,000,000 when commercial production commences for a total of $3,000,000.
"We look forward to seeing Pilot Metals advance the project. The proceeds generated by the option and sale of the claims will allow Pacific Gold to direct additional money towards its permitted properties in anticipation of production." said Rob Landau, CEO.
To find out more about Pacific Gold Corp. (PINK SHEETS:PCFG), visit the Company's website at www.pacificgoldcorp.com. You can also contact the Company directly at 416-214-1483.
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