Mr. Richard Groome reports
CHIMATA GOLD CORP SELLS ITS INTEREST IN
TROILUS NORTH PROPERTY FOR CASH AND SHARES
Chimata Gold Corp.'s amendment to the option agreement previously entered into with Emgold Mining Corp. on June 27, 2018, and as
announced in a press release on the same day, granting Emgold the option to acquire up to a
100-per-cent interest in the Troilus North property from the company, has been approved by the TSX Venture Exchange. Details of the amendment were
announced by the company in a news release dated Aug. 13, 2018.
Emgold has accelerated and completed all the requirements of the
option agreement and the amending agreement, thereby closing the acquisition by Emgold of a
100-per-cent interest in the property from the company.
Details on the option agreement and amendment
The option agreement and amendment provide that Emgold would have the exclusive right and
first option to acquire an 80-per-cent interest in the property over a two-year period for consideration of common shares Emgold would
issue to Chimata as shown in the table on the first option requirements, completion of $300,000 (Canadian) in exploration expenditures
to be incurred within two years of closing of the transaction and a cash payment of $200,000 (Canadian).
SHARE, CASH, AND EXPLORATION EXPENDITURE REQUIREMENTS
FOR FIRST OPTION, TROILUS NORTH PROPERTY
Date Common shares Cash Exploration expenditures
Upon closing of
transaction, June 27, 2018 2,000,000 (issued) $0 not applicable
Upon approval of the
amendment nil $200,000 not applicable
First anniversary of the
closing date 2,000,000 $0 not applicable
Second anniversary of
the closing date 1,000,000 $0 $300,000
Total first option 5,000,000 $200,000 $300,000
Upon completing the first option, Emgold would have a further option to
acquire the remaining 20-per-cent interest (total 100-per-cent interest) in the property by issuing to the company
a further 1.0 million common shares as shown in the table on the second option requirements. Chimata will retain a 1-per-cent net
smelter return (NSR) royalty for Troilus North, being agreed that half of which (0.5 per cent) could be
purchased by Emgold at any time for $500,000 (Canadian) and that the entire NSR (1.0 per cent) could
be purchased by Emgold at any time for $1-million (Canadian).
SHARE, CASH AND ROYALTY REQUIREMENTS
FOR SECOND OPTION, TROILUS NORTH PROPERTY
Date Common shares Cash Royalty
Upon exercise of second option 1,000,000 nil 1.0% NSR
Total second option 1,000,000 nil $300,000
Exercise of first option and second option to acquire 100-per-cent interest in the Troilus North property
Since optioning the property, Emgold has completed the $300,000 (Canadian) requirement in exploration
expenditures on the property and has elected to move forward with acquisition of a 100-per-cent ownership
of the property by accelerating the exercise of the first option and second option together. As
such, Emgold has closed the 100-per-cent acquisition of the property by completing the remaining
requirements of the option agreement and amendment, which required Emgold to issue 4.0
million additional common shares, make a cash payment of $200,000 (Canadian) and grant a 1.0-per-cent NSR
on the property to Chimata. Following the closing of the transaction, Chimata holds 6.0 million
common shares of Emgold out of 30,968,805 common shares, representing 19.4 per cent of Emgold's
issued and outstanding share capital. The transaction described herein between Emgold and
Chimata was a non-arm's-length transaction as Chimata's director and chief financial officer, Robert Rosner, also acts as director of Emgold.
Alain Moreau, a qualified person as defined by National Instrument 43-101, Standards of Disclosure for Mineral
Projects, has approved the scientific and technical disclosure in this press release.
We seek Safe Harbor.
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