East Africa Metals Executes Binding Letter of Intent With Tibet Huayu Mining for the Financing and Development of the Terakimti, Mato Bula and Da Tambuk Deposits, Ethiopia

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[{"type":"text","content":" VANCOUVER, British Columbia, Feb. 08, 2019 (GLOBE NEWSWIRE) -- East Africa Metals Inc. (TSX-V: EAM) (“East Africa”, “EAM” or the “Company”) is pleased to announce EAM have executed a binding Letter of Intent (“LOI”) with Tibet Huayu Mining Co., Ltd (“Tibet Huayu”) for the exploration, development and operation of EAM’s Ethiopian Mining Assets; the Terakimti, Mato Bula and Da Tambuk gold projects located in the Tigray National Regional State of the Federal Democratic Republic of Ethiopia (“Ethiopia”). Tibet Huayu is a Chinese mining company with its headquarters in Lhasa, China and is publicly listed on the Shanghai Stock Exchange. The LOI contemplates EAM transferring its equity interest in its Ethiopian subsidiary companies to Tibet Huayu and the parties entering into Joint Venture Contracts for the purpose of development and operation of EAM’s Ethiopian Mining Assets. EAM owns 70% of the Harvest Mining PLC (“Harvest”) and 100% of the Tigray Resources Incorporated PLC (“TRI”). Harvest holds the Terakimti oxide gold mining license. EAM’s subsidiary, TRI hosts the Mato Bula and Da Tambuk deposits (“Adyabo Property”) which are in the final process of mine permitting. The transaction defined in the binding LOI includes terms that in exchange for 55% interest of Harvest and 70% interest in TRI, Tibet Huayu will: Provide a cash payment of US$1.7M to EAM; Finance, develop and operate the Terakimti, Da Tambuk and Mato Bula projects. On completion of the proposed transaction: Tibet Huayu will hold the rights (interest) to 55% post tax profits/Government distributions of Harvest and hold the rights (interest) to 70% of the post tax profits/Government distributions of TRI. EAM will hold the rights (interest) to 15% post tax profits/Government distributions of Harvest and hold the rights (interest) to 30% of the post tax profits/Government distributions of TRI. Closing conditions include: Required approvals including and not limited to Board, Regulatory, and Government approvals; Execution of the definitive agreement; and EAM has received the cash payment of US$1.7M. EAM will retain the mineral rights, and all exploration obligations for the prospective targets not incorporated in the three mining licenses (“EAM Mineral Resources”). EAM shall give Tibet Huayu a right of first refusal of reasonable duration to acquire EAM’s Mineral Resourc...

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