The TSX Venture Exchange has accepted for filing documentation the share exchange agreement dated May 10, 2023, between the company and an arm's-length party. Pursuant to the terms of the agreement, the company has agreed to purchase all of the outstanding common shares in the authorized share structure of the vendor, including the existing underlying option agreement to acquire up to a 70-per-cent interest in the Redgold copper-gold project. As consideration for the purchase, the company has issued to the vendor 12 million common shares of the company at a deemed price of 23.5 cents per share.

The company and third party arm's-length optionors of the underlying option agreement have amended the underlying option agreement, whereby the company will have the right to exercise the first stage of the option to earn in 51 per cent of the project, by paying to the optionors a consideration of: (i) $500,000 cash ($50,000 paid); (ii) incur eligible expenditures of $2-million; (iii) issue 400,000 shares by October, 2024; and (iv) issue an additional $400,000 value in shares by October, 2026.

If the company exercises the first option, it will have the right to increase its interest in the project from 51 per cent to 70 per cent by paying to the optionors an additional consideration of: (i) $500,000 cash; (ii) incurring an additional $2-million of eligible expenditures; (iii) and issuing an additional $500,000 value in shares prior to October, 2028.

Any shares issued to the optionors pursuant to the underlying option agreement will be subject to a floor issuance price of 17.625 cents per share, resulting in a maximum of 5,106,384 shares being issued. The company has also agreed to make maximum cash payments of $644,681 to the optionors if the value of the company's shares on the exchange is below the floor price on the relevant issuance date.

The optionors will retain a 2.5-per-cent net smelter return (NSR) royalty, which will come into effect if and when the optionors' collective participating interest in the project is diluted to less than or equal to 15 per cent. The company will have the right to repurchase 1.0 per cent of the NSR for $2-million cash.

Insider/pro group participation:  none

Finders' fees:  none

This acquisition is considered an arm's-length transaction.

For further information, please refer to the company's news releases dated May 12, 2023, June 20, 2023, June 28, 2023.