LONDON, UNITED KINGDOM--(Marketwire - Nov. 5, 2012) - Touchstone Gold Limited ("Touchstone") (AIM:TGL) is pleased to announce the completion of the acquisition of a 60% interest in the El Cinco property (the "Acquisition") from a Colombian branch of a company (the "Vendor") through a wholly owned subsidiary of Touchstone which took effect on 2 November 2012, through the issue of 4,089,762 Touchstone Ordinary Shares valued at $750,000 (the "New Shares") and the issue of a short term promissory unsecured note to the Vendor for the balance of C$250,000.
- 17km sq increase in Touchstone's Segovia Gold Project, adjacent to El Cinco property
- Combined asset to include over 15km of prospective strike length where Touchstone has already reported encouraging high-grade drill results
- High Grade gold mineralization and geology identified within the 1141 Zone at Rio Pescado known to extend south onto the El Cinco property
- Geochemical and geophysical anomalies open to the south and along trend onto El Cinco ground
- El Cinco to be one of the primary areas of focus for Touchstone's stage 4, 20,000m to 25,000m, drill programme in Q4 2012 - Q4 2013
David Wiley, the Chief Executive Officer of Touchstone, commented:
"We are very pleased to announce the completion of this transaction, which significantly enhances the potential of our highly promising Segovia gold project. It is especially encouraging that the high grade gold mineralisation identified at our 1141 project appears to extend onto El Cinco, which will be one of our main areas of focus for the upcoming Stage 4 drilling programme. We look forward to an exciting time ahead as we work to build Touchstone into a significant gold producer in the area."
Touchstone is a gold exploration company and its primary assets, which collectively comprise its Segovia Gold Project, are the Rio Pescado, El Cinco, San Miguel, and Frontino Norte properties along the Segovia-Remedios Gold Belt in Colombia. Rio Pescado is comprised of four mining concessions, the El Cinco property is comprised of one mining concession, the San Miguel property is comprised of one mining concession and one proposed mining concession, and the Frontino Norte property is comprised of four mining concessions and one proposed mining concession. Touchstone owns further options on the Santa Rosa Project, in the South Bolivar area of Colombia, comprised of four proposed mining concessions and one mining concession. With a philosophy of creating value by the systematic exploration and development of Touchstone's existing assets as well as the acquisition of suitable exploration and development mineral projects, Touchstone's long-term intention is to build a significant gold exploration and production company.
The Acquisition has been carried out through a Purchase Agreement (the "Agreement"). As consideration for the Acquisition, Touchstone has issued to the Vendor 4,089,762 common shares valued at C$750,000 and an unsecured promissory note in the principal amount of C$250,000 (the "Note").
The Note shall be payable upon written demand made at any time after 15 December, 2012. Commencing on 16 December, 2012 Touchstone shall pay interest at the rate of 10% per annum, payable quarterly in arrears. If the principal or any portion of it remains unpaid as of 15 March, 2013, the Vendor shall have the right to convert unpaid principal and interest into common shares of Touchstone equal to C$350,000 based on the 20 day volume weighted average of the trading price preceding the date the conversion notice is given.
Touchstone's Board of Directors has concluded that the Acquisition is in the best interests of the company and has unanimously approved the terms of the Acquisition.
This news release has been prepared under the supervision of, and approved by, John Nicholson, P.Geo., B.Sc., who is a "qualified person" as defined under National Instrument 43-101. Mr. Nicholson serves as the Chief Geologist of Touchstone.
Cautionary Note Regarding Forward-Looking Information
Certain information set forth in this press release contains "forward-looking information" under applicable securities laws. Except for statements of historical fact, certain information contained herein constitutes forward-looking information which includes management's assessment of Touchstone's future plans and operations and are based on Touchstone's current internal expectations, estimates, projections, assumptions and beliefs, which may prove to be incorrect. Some of the forward-looking information may be identified by words such as "expects" "anticipates", "believes", "projects", "plans", and similar expressions. These statements are not guarantees of future performance and undue reliance should not be placed on them. Such forward-looking information may necessarily involve known and unknown risks and uncertainties, which may cause Touchstone's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking information. These risks and uncertainties include, but are not limited to: liabilities inherent in mine development and production; geological, mining and processing technical problems; Touchstone's inability to obtain required mine licenses, mine permits and regulatory approvals required in connection with mining and mineral processing operations; competition for, among other things, capital, acquisitions of resources and reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in commodity prices and exchange rates; currency and interest rate fluctuations; various events which could disrupt exploration and development, including labour stoppages and severe weather conditions; and management's ability to anticipate and manage the foregoing factors and risks. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Touchstone undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking information.