Loyalist Exploration Announces Agreement of Purchase and Sale for Gold Property Acquisition in the Timmins Mining District
Executive Summary
- Loyalist Exploration entered a purchase‑and‑sale agreement to acquire 100 % of the DeSantis gold property near Timmins, Ontario.
- Consideration includes $100,000 cash, $400,000 in newly issued common shares, and a $1,000,000 promissory note (10 % interest) with flexible repayment terms.
- Additional contingent payments of up to $2,000,000 may be triggered upon filing a NI‑43‑101 resource estimate exceeding 200,000 oz Au or achievement of commercial production.
Key Details
- Property Overview
- ~850 ha located on the north side of the Destor‑Porcupine Deformation Zone (DPDZ).
- Historical production: 35,784 oz Au from 196,928 t at 0.19 oz/t (≈6.2 g/t) between 1926–1943.
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Historic non‑NI‑43‑101 resource: 182,505 t @ 8.64 g/t Au (Albitite & Hydrothermal zones).
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Purchase Consideration
- $100,000 cash payable at closing.
- Issuance of $400,000 worth of Loyalist common shares based on a 20‑day VWAP calculated two days before closing.
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Promissory note: principal $1,000,000, interest 10 % per annum; repayment can be in cash or Loyalist shares at the greater of (i) CSE minimum acceptable price or (ii) 5‑day VWAP calculated two days prior to payment.
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Contingent Future Consideration
- Resource Payment: $400,000 (cash and/or shares) payable within 60 days after filing a NI‑43‑101 technical report if the re‑evaluated gold resource exceeds 200,000 oz.
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Commercial Production Payment: $1,000,000 (cash and/or shares) payable within 60 days of announcing commercial production on the property.
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Royalty Structure
- Royalty 1: 1.5 % NSR (0.5 % may be repurchased for $0.25 M; 1.0 % may be repurchased for $0.5 M).
- Royalty 2: 2.0 % NSR (1.0 % may be repurchased for $1.0 M).
- Royalty 3: 1.5 % NSR (0.5 % may be purchased for $1.0 M).
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Royalty 4: 2.0 % NSR payable upon production (1.0 % may be repurchased for $1.0 M).
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Closing Conditions
- Subject to regulatory approvals and, if a new control person is created, shareholder approval.
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All Loyalist shares issued in connection with the acquisition are subject to a four‑month plus one‑day statutory hold period.
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Finder’s Fee
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Cash fee equal to 6 % of cash consideration paid to Vendor; additional issuance of common shares equal to 6 % of shares issued to Vendor, payable at the same time as the purchase consideration.
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Qualified Person
- Curtis Ferron, P.Geo., reviewed and approved the technical content of this release.
Notable Quotes
“Loyalist continues to ‘Buy Timmins’ with the acquisition of the DeSantis property… We could not ask for a better ‘Park Avenue’ address along the Porcupine Destor fault, close to Timmins.” – Errol Farr, President & CEO
Materiality Assessment: Material – Positive (the transaction adds a historically productive gold asset with significant upside and includes substantial cash/ equity consideration and future contingent payments).