Inflection Resources has signed a non-binding Heads of Agreement with AngloGold Ashanti that outlines the principal terms under which AngloGold may enter into a multi-year Earn-in Agreement across a number of Inflection's copper-gold projects in New South Wales, Australia. Following execution of the Earn-in Agreement, AngloGold shall fund a total of AUD$10 million on exploration expenditures across the portfolio of projects within three years as part of a Phase I exploration program. Phase I, intended to drill test a wide range of large intrusive-related, copper-gold exploration targets including Duck Creek, will include a minimum expenditure commitment of AUD$6 million. Upon completion of Phase 1, the original AUD$10 million advanced by AngloGold, shall be converted into common shares of Inflection equal to 9.9% of the then issued outstanding common shares.
Phases II and III are staged earn-in's whereby AngloGold may select up to five Designated Projects in which to earn up to a 65% interest in each by funding exploration expenditures of AUD million over three years in Phase II and a further AUD 0 million over two years in Phase III on each Designated Project, for cumulative maximum expenditures of AUD 35 million. AngloGoldretains the further right to earn an additional 10% interest in each Designated Project in Phase IV by completing a Pre-Feasibility Study solely funded by AngloGold within an additional three-year period; and granting Inflection, subject to existing underlying royalties, a 2% or 1% net smelter royalty.