Manitou Gold Announces Agreement to Sell 100% Interest in its Dryden Properties
07 March 2022 - 11:00PM
Manitou Gold Inc. (TSX-V: MTU) (the “
Company” or
“
Manitou”) is pleased to announce that it has
entered into a binding agreement (the “
Agreement”)
to sell a 100% interest in its Dryden properties located in
northwestern Ontario (the “
Property”) to Dryden
Gold Corp. (“
Dryden Gold”). Dryden Gold is a
private company, controlled by the founders and management of Ely
Gold Royalties Inc., a public company that was sold in 2021 to Gold
Royalty Corp. for approximately $300 million.
Highlights:
- Manitou sells 100% interest in
Dryden properties, including Kenwest and Gaffney, for $7,000,000 to
Dryden Gold;
- Manitou Receives 4,000,000 common
shares of Dryden Gold;
- Manitou Retains a 1% net smelter
royalty; and
- Dryden Gold to fund exploration
expenditures totaling $1,400,000 over a three year period.
“We are excited that Dryden Gold Corp. will be
taking the lead in advancing exploration on the Dryden properties.
Manitou will become a significant owner of Dryden Gold, who will be
pursuing an initial public offering later this year, following
which Manitou will retain a large insider ownership position of
Dryden Gold” stated Richard Murphy, President and CEO of Manitou.
“We believe strongly in the potential of the Dryden properties and
look forward to our future participation in the exploration upside
of these properties through our large shareholding in Dryden Gold,
as well as our retained net smelter royalties on the
properties.”
Under the terms of the option agreement, Dryden
Gold shall issue 4,000,000 common shares of Dryden Gold to Manitou
upon the receipt of all applicable regulatory approvals (the
“Effective Date”), as well make aggregate payments
of Cdn$7,000,000 to Manitou as follows:
- Cdn$1,000,000 payable on the
Effective Date (of which $100,000 has been paid to the Company as a
deposit, $50,000 of which is non-refundable);
- Cdn$2,000,000 payable on the first
anniversary of the Effective Date as to 50% in cash and 50% in
Shares;
- $2,000,000 payable on the second
anniversary of the Effective Date as to 50% in cash and 50% in
Shares; and
- $2,000,000 payable on third
anniversary of the Effective Date as to 50% in cash and 50% in
Shares.
Upon payment in full of all cash payments,
issuances of all shares, and completion of all work commitments,
Dryden Gold will vest a 100% interest in the Property, subject to a
1% net smelter return royalty to be retained by Manitou (one-half
of which may be purchased, aside from the Kenwest property, for a
cash payment of $1,000,000).
Other than the initial issuance of shares on the
Effective Date, all Share issuances are contingent on Dryden Gold
completing an initial public offering and shall be priced at the
volume weighted average price (“VWAP”) of Dryden
Gold shares on the principal stock exchange upon which they trade
for the twenty (20) trading days immediately preceding the
respective payment date. If an initial public offering of Dryden
Gold has not been completed by the respective payment date, all
amounts shall be payable entirely in cash.
In addition to the foregoing, Dryden Gold must
complete minimum exploration work on the Property totaling
$1,400,000 over a three year period, of which Dryden Gold has made
a firm commitment to complete $600,000 prior to the first
anniversary of the Effective Date.
The Agreement remains subject to various closing
conditions including, without limitation, the completion of a due
diligence review by Dryden Gold and the receipt of all applicable
approvals of the TSX Venture Exchange.
For further information on Manitou Gold
Inc., contact:
Richard Murphy, CEO Telephone: 1 (705) 698-1962
Email: info@manitougold.com
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Forward Looking Statements – Certain information
set forth in this news release may contain forward-looking
statements that involve substantial known and unknown risks and
uncertainties, including regulatory risk related to the receipt of
final approval of the TSX Venture Exchange for the Offering. These
forward-looking statements are subject to numerous risks and
uncertainties, certain of which are beyond the control of Manitou,
including with respect to the prospective nature of the Stover and
Renabie-Easy Lake properties. Readers are cautioned that the
assumptions used in the preparation of such information, although
considered reasonable at the time of preparation, may prove to be
imprecise and, as such, undue reliance should not be placed on
forward-looking statements.
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