Orlando, FL 6/5/12 (StreetBeat) -- Tara Minerals Corp. (OTCBB:TARM) is pleased to announce that its subsidiary, Adit Resources Corp, has entered into an agreement for the sale of American Copper Mining S.A. de C.V., the holder of Adit's Picacho group of concessions, to Yamana Mexico Holdings B.V., a subsidiary of Yamana Gold Inc.
The Picacho group of concessions consists of 7,060 hectares and is located in Sonora, Mexico. Work to date on Picacho has identified nine gold-bearing veins over four mineralized target areas with an aggregate strike length of over 10.8 km.
Yamana has paid Adit $7.5 million upon closing, and, upon exercising the option to complete the acquisition, will pay (i) $9.8 million on or before the 12 month anniversary; (ii) an additional $1 million for every 100,000 ounces defined by the 60 month anniversary; and (iii) a final installment payment of $4.3 million on the sixth year anniversary. The payments for the measured, indicated, and inferred ounces defined will be capped at $14 million. If no gold is defined on the property by the 36 month anniversary, Yamana will make an advance payment of $3 million.
Following this sale, Tara Minerals has set fourth main five priorities to complete. These include:
1st Priority - Strengthen balance sheet
1. Pay off all short-term debts & stay debt free
2. Make last payment on iron ore property. Own 100%
3. Now has cash to start and maintain production
4. Monthly cash burn $200K. Low overhead
2nd Priority - Start iron ore project
1. Demonstrate ability to start and maintain production
2. Show consistent sales, cash flow, earnings
3. Build cash hoard/liquidity to further strengthen balance sheet.
3rd priority - start publishing 43101 geological studies to define resource. Gold, silver, copper, lead, zinc, iron ore
4th priority - Start Dom Ramon production. Gold, silver, lead, zinc.
5th priority - What to do with cash flow?
1. Continue to add value via buying mining rights in Mexico.
2. Start buying back stock
3. Start paying a dividend
4. Stay debt free
Robert Wheatley, President of Adit, commented, "This agreement is beneficial to both parties. It a) provides Adit with a debt-free platform for future exploration and property acquisitions and provides its parent Tara, with funds to immediately advance production focused projects; and b) gives Yamana a strategic asset to grow its Mexican resources."
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