On December 22, 2006, Sargold Resource Corporation reported it had completed the formal purchase agreement previously announced on October 30, 2006 and executed December 18, 2006, with Gold Fields Netherlands Services B.V., an indirect subsidiary of Gold Fields Limited, whereby Sargold has acquired all of Gold Fields' interest in the Monte Ollasteddu project in Sardinia, Italy. With the completion of this agreement, Sargold now holds a 90% interest in the Monte Ollasteddu project, with the remaining 10% held by Progemisa SA.
As consideration for this interest in the property, Sargold will issue to Gold Fields common shares of the company with a value of $500,000 in three installments, with the first installment of 833,333 shares being issued on December 22, 2006 at a price of $0.20 per share, and the second and third equal installments being issued on the first and second anniversary dates of December 18, 2006, respectively. Gold Fields will have a back in-right to acquire up to an undivided 66-2/3% interest in the property, which could at their discretion be triggered when exploration work programs undertaken by Sargold on the project have defined a minimum NI 43-101 compliant, measured and indicated resource estimate of 3.5 million ounces of gold. Gold Fields has also completed a concurrent non-brokered private placement to Gold Fields of 5,000,000 Shares at a price of $0.25 per Share for proceeds of $1,250,000, which will be used for exploration work expenditures and operations on the Company's mineral properties.
Fasken Martineau advised Sargold in this transaction with a team comprised of Darrell Podowski, Sarah Mamoser, Georald Ingborg and Josh Lewis.