Unigold Inc. (TSXV:UGD) entered into an agreement with Malbex Resources Inc. (TSXV:MBG) to provide the Company’s consent to the acquisition of Americana de Explotaciones Mineras S.R.L. by Malbex.
As quoted in the press release:
In exchange for Unigold consenting to the acquisition, Malbex has agreed to: (i) issue to Unigold 13,000,000 common shares in the capital of Malbex (the “Malbex Shares”); and (ii) grant to Unigold a 2% net smelter returns royalty in respect of all minerals produced from the Property (the “NSR”). Half of the NSR may be repurchased by Malbex for $1,000,000 which would leave Unigold with a royalty equal to 1% of net smelter returns. Additional consideration of 5,000,000 common shares of Malbex will be issued to Unigold in the event that Malbex, within the period commencing on the date upon which Americana is issued the concession agreement in respect of the Property and ending five years thereafter, delineates 2,000,000 ounces of gold from the Property on a National Instrument 43-101 compliant basis in the measured and/or indicated mineral resource categories. All such common shares of Malbex which may be issued to Unigold pursuant to the Consent Agreement will be subject to a hold period which will run for a period of four months from the time of the issue of such common shares.
Unigold Inc. President and CEO, Andrew Cheatle said:
This deal is strategic for Unigold and allows our shareholders to participate through the 13-million shareholding in any discovery at Los Guandules. We are also very pleased to have helped attract a new exploration company, Malbex, to the Dominican Republic. Unigold is appropriately focused on exploring and developing the over 21 identified high quality and high priority targets on Neita, including the Candelones and Candelones Extension discoveries.