Motor should be ok, replace the belt!!! Also it would be a good time to replace the other componets as needed, ie water pump crank and cam seals while i is being repaired. This is a non interfetence engine! Without some testing your mechanic cannot just up and say the motor is shot.
Get another opinion! I have fixed a BUNCH of these. However keeping in mind ANY engine can have valve to piston contact under the right conditions, it would be very rare for this one though.