Southern Arc & Indotan close acquisition
TSX Venture-listed Southern Arc Minerals Inc. has closed its acquisition of certain rights from Indotan Inc., including the right to the name Indotan Inc. Subsequent to its previous announcement, the structure of the transaction was modified to include the acquisition of two Singapore subsidiaries of Indotan.
Indotan assigned its rights to the Indotan name, granted Southern Arc power and control over all matters related to the Singapore companies, and has agreed to transfer the shares in the Singapore companies to Southern Arc once the required permits have been granted to the Singapore companies pursuant to the mining laws of Indonesia.
In consideration for the assignment of the rights to the applications, the acquisition of the subsidiary and the name Indotan Inc., Southern Arc will issue 3.5 million common shares to the parent company subject to two options in favour of Southern Arc. The first option will entitle Southern Arc to acquire 1.5 million of these shares at a price of $0.90 per common share within a period of 18 months.
The second option will entitle Southern Arc to acquire 0.5 million of these shares at a price of $0.50 per common share within a period of 8 months. All of the shares to be issued by Southern Arc will be subject to a four month statutory hold period. In place of the existing 1% NSR’s on both the Sumbawa and Lombok Properties, Southern Arc will grant a 2% NSR on the Sumbawa property and a 1% NSR on the Lombok Property, as those applications were originally described in March, 2005.
In the case of the Lombok Property, the NSR does not apply to the Block 1 property (which encompasses all of Selodong, Mencanggah, and Pelangan prospects) acquired by Southern Arc from Newmont in January, 2006.