SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 2, 2012
Laredo Resources Corp.
(Exact name of registrant as specified in its charter)
| Nevada | 333-171457 | n/a |
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
300 Jameson House 838 West Hastings Street Vancouver, B.C., Canada |
V6C 0A6 |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (604) 669-9000
|
________________________________________________________ (Former name or former address, if changed since last report)
|
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425) |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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SECTION 8 – OTHER EVENTS
Item 8.01 Other Events
On November 2, 2012, we entered into a letter agreement with Magna Management Ltd. (“Magna”) under which we have been granted the exclusive right, for a period of sixty (60) days, to negotiate for the purchase of all rights held by Magna in the mineral property known as Pony Mountain Gold, located in the Mineral Hills District (commonly called the Pony District) in southwestern Montana. During the exclusive negotiation period, we will have access to all documentation and information regarding the title and geology of the property and any other information necessary for the completion of our due diligence. We anticipate that our purchase of Magna’s rights to the property, if consummated, would be made through a combination of cash payment and issuance of common stock, with the rights being assigned to a wholly-owned subsidiary to be formed. Pricing and other details of the potential acquisition of Magna’s rights are the subject of ongoing negotiations.
The Pony Mountain Gold property is comprised of an approximately 4000-acre package of properties, assembled over the years by a local family and local geologist. The property contains several previously-mined, underground hard-rock vein systems, such as the Mountain Cliff, Strawberry-Keystone, Amy, and Atlantic-Pacific (A-P) mines. Historically, the Pony Mountain Gold property has been productive, and we believe it has potential for new productivity.
In the event that we acquire Magna’s rights to the Pony Mountain Gold property, we will assume Magna’s rights and duties under a Memorandum of Understanding between Magna and the various owners of the property (the “MOU”). As the assignee of Magna’s rights under the MOU, we would be entitled to exclusive proprietary marketing rights for the property in exchange for total payments of $3,000,000 to be made in quarterly installments of $250,000 each. The deadline for the first installment payment to the owners, as currently extended, is December 5, 2012. All net revenues received from third-party processors of material mined from the property will be paid to the owners of the property and applied to the total purchase price until paid in full. The owners will retain a perpetual 2% net smelter royalty. Closing of the transaction contemplated by the MOU will be documented under a definitive Mining Lease and Option Agreement.
Magna has engaged Moen Excavating, LLC to take and prepare samples from dumps located on the Pony Mountain Gold property, to coordinate laboratory testing of samples taken from the property, and to conduct negotiations with the Golden Sunlight-Barrick mill for the processing of material from the property. Magna has also agreed to engage Moen Excavating for all surface work on the property and for the future hauling of dump material from the property to the mill. In the event that we are assigned Magna’s rights to the property, we plan to continue the engagement with Moen Excavating as Magna’s assignee.
Section 9 – FINANCIAL STATEMENTS AND EXHIBITS
Item 9.01 Financial Statements and Exhibits
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Laredo Resources Corp.
/s/ Robert Gardner
Robert Gardner
President, Chief Executive Officer
Date: November 5, 2012
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Laredo Resources Corp.
300 Jameson House, 838 West Hastings Street, Vancouver, BC Canada V6C OA6 Phone: 604 669-9000
November 2, 2012
Via Email and Mail
Magna Management Ltd.
#300, 838 West Hastings Street
Vancouver, V6C OA6
Attention: Carolin Schella
Re: Purchase of Rights
Dear Ms. Schella
This is to confirm that the parties Laredo Resources Corporation, and Magna Management Ltd. hereby agree that Magna Management Ltd. will from this date grant to Laredo Resources Corporation the exclusive rights for a period of {60) sixty days to negotiate for the purchase of the rights that Magna Management Ltd. has in the property know as Pony Mountain Gold, located in the Mineral Hills District (commonly called the Pony District) in southwestern Montana, comprising of approximately 4000 acres. That Laredo Resources Corporation will in the interim have access to all the documentation and information respecting title, geology and any other necessary due diligence. It is anticipated that this transaction is for the purchase of any rights that Magna Management Ltd. has in the property. It is also anticipated Laredo Resources Corporation may transfer those rights to a U.S wholly owned subsidiary, and will involve a part share and cash transaction.
| Laredo Resources Corporation | Magna Management Ltd. |
| /s/ Robert Gardner | /s/ Carolin Schella |
| President | President |
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Magna Management Ltd. 2153-349 W Georgia St. Vancouver. BC V6B 3V3 Tel 604 669-9000 Fax 604 899-8827
MEMORANDUM OF UNDERSTANDING ("MOU")
Between:
Marlene Moen, Gene Nellis, Hartmut Baitis and lnga Baitis (collectively "Owners")
And
Magna Management Ltd. and/or Nominee ("Magna")
Pursuant to the terms and conditions of this MOU, Magna shall have exclusive proprietary marketing rights (the "Rights") for the "Pony" property located near Pony, Montana owned by the Owners (the "Property") which is described in the attached Exhibit A. In order to acquire and retain the Rights, Magna shall pay the Owners the sum of $20,000 USD upon execution of this MOU and the sum of $20,000 USD on the 5th day of each succeeding month beginning on June 5, 2012 through October 5, 2012 for a total of six payments which are non-refundable but which will be applied to the final payment of the total consideration required to be paid under section 1 below. Provided, however, notwithstanding the foregoing, in the event that Magna obtains approval from the Canadian stock exchange (the "43-101 Approval") prior to October 5, 2012, the first payment described in section 1 below shall be due within ten (10) days after receipt of the 43-101 Approval.
That Magna shall follow the following parameters in the event of a "vend-in" to a public company:
1. That the total consideration is $3,000,000 USD in cash paid in equal payments quarterly beginning on the earlier of November 5, 2012 or ten (10) days after receipt of the 43-101 Approval (the "Closing Date") with each quarterly payment in the amount of $250,000 USD which shall include interest at the rate imputed under IRS regulations. The total consideration shall be paid over a period of three years. Each payment is non-refundable and allows Magna or its nominee the right to exercise possessory rights to the. Property so long as the payments are timely made.
2. That the Property shall be made available for a 43-101 that may be immediately commenced after the first $20,000 USD monthly payment is made.
3. Owners shall not pay any broker or finder or other person a commission, finder's fee, brokerage fee or any . similar fee in connection with this MOU or this transaction.
4. At least ten (10) days prior to the Closing Date, Magna shall submit to Owners a definitive Mining Lease and Option Agreement for Owners' consideration. The parties shall enter into a definitive Mining Lease and Option Agreement prior to the Closing Date.
5. All net revenues received from a third party processor (such as Golden Sunlight Mine-Barrick) from processing ore stockpiles, tailings and dumps from the Property shall be paid to Owners and applied to the total consideration owed to Owners.
6. Owners retain a perpetual royalty on production from the Property of a 2% NSR (the "Royalty"). The Royalty also applies to production on all unpatented claims that are located by Magna or its assigns at any time that are located within one (1) mile of the exterior boundaries of the Property.
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Magna Management Ltd. 2153-349 W Georgia St. Vancouver. BC V6B 3V3 Tel 604 669-9000 Fax 604 899-8827
That this Memorandum of Understanding will be formalized at the option of the parties with their respective lawyers.
| Signed: | Date Signed: |
| /s/ Marlene Moen | 5/3/2012 |
| Marlene Moen | |
| /s/ Gene Nellis | 5/3/2012 |
| Gene Nellis | |
| /s/ Hartmut Baitis | 5/3/2012 |
| Hartmut Baitis | |
| /s/ Inga Baitis | 5/3/2012 |
| Inga Baitis | |
| And | |
| /s/ Magna Management Ltd. | 5/3/2012 |
| Magna Management Ltd. and/or Associate |
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Magna Management Ltd. 2153-349 W Georgia St, Vancouver, BC V6B 3V3 Tel 604 669-9000 Fax 604 899-8827
November 2nd, 2012
Matt Moen
Box 54
Virginia City, MT 59755
Dear Matt,
Once again, we would like to thank you for your communications with Marlene Moen, Gene Nellis, Hartmut Baitis and lnga Baitis who are the collective (owners) of the mining property associated with the Pony claims. Thank you for confirming that the owners have agreed to an extension of a $250,000 payment due November 5th, 2012 to December 5th, 2012. As discussed we will provide an addendum to the agreement and will be sending it to Rick Orizotti for his review.
Sincerely,
/s/ Carolin Schelta
Carolin Schelta
Magna Management Ltd.
2153-349 W Georgia St
Vancouver, BC V6B 3V3
Mobile: 604 838-8303
Office: 604 669-9000
Email: botanybug@shaw.ca
Magna Management Ltd. 2153-349 W Georgia St. Vancouver, BC V6B 3V3 Tel604 669-9000 Fax 604 899-8827
Execution version
MEMORANDUM OF UNDERSTANDING ("MOU")
Between:
Moen Excavating, LLC ("Moen Excavating")
And
Magna Management Ltd. and/or Nominee ("Magna")
That it is agreed that Moen Excavating shall provide certain services, as described herein, on the dumps located on that certain property in the area of Pony,Montana which consists of patented and unpatented mining claims owned by Marlene Moen,Gene Nellis, Hartmut Baitis and lnga Baitis (the "Property") in which Magna has acquired certain rights.
Magna will pay Moen Excavating the sum of $10,000 USD a month beginning upon execution of this MOU, to take/prepare samples from the dumps located on the Property, coordinate the sampling with laboratories for the testing of samples and conduct negotiations and discussions with Golden Sunlight-Barrick mill for processing of the dump material at the mill. Thereafter, all surface work that may be required on the Property and hauling of the dump material to the mill shall be provided by Moen Excavating pursuant to a separate agreement with Magna.
That this Memorandum of Understanding will be formalized at the option of the parties with their respective lawyers.
Signed:
| Moen Excavating, LLC. | ||
|
/s/ Roy Mathew Moen by: Roy Mathew Moen its Manager |
May 4, 2012 Date Signed | |
| And | ||
|
/s/ Magna Management Ltd. Magna Management Ltd. and/or Associate |
May 4, 2012 Date Signed |
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