The TSX Venture Exchange has accepted for filing documentation for the letter agreement dated Jan. 19, 2023, and the letter of amendment dated April 6, 2023 (together the agreement), between the company and an arm's-length party. Pursuant to the terms of the binding agreement, the company has been granted the exclusive option to acquire, in two stages, up to a 75-per-cent interest in and to the prospecting and exploration licence covering the Zlatusha gold-copper property. The option to earn-in is staged as follows.

The company has the option to satisfy the payment in common shares of the company through a cash payment based on the deemed issuance price per share equal to the greater of 16.25 cents per share and the 20-day volume weighted average price of the shares on the exchange, ending on the trading day immediately prior to the issuance of the shares.

The agreement also provides that, during the term of the first option, the company may carry a drilling shortfall into the immediately following year, provided that the company cannot terminate the first option prior to having completed 3,000 metres of drilling on or prior to Sept. 23, 2024.

The property is subject to an existing 2-per-cent net smelter return (NSR) royalty held by an arm's-length party. The NSR holder will have the right to repurchase an initial 0.5-per-cent NSR royalty for $2.5-million (U.S.) prior to commencement of commercial production (reducing the royalty from 2.0 per cent to 1.5 per cent). The NSR holder will then have the right to repurchase a further 1.0-per-cent royalty for an additional $500,00 (U.S.) prior to commencement of commercial production (reducing the royalty from 1.5 per cent to 0.5 per cent).

Upon exercise of the options, the company and optionor will have been deemed to have entered a joint venture on the property, with the interest in the project directly relating to the options exercised.

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

For further information, please refer to the company's news releases dated Jan. 24, 2023, and April 20, 2023.