DRC Gold Corp. Granted Option to Acquire Interests in Giro and Nizi Gold Projects

Executive Summary

• DRC Gold entered into a binding term sheet granting it an option to acquire up‑to 65% indirect interests in the Giro Gold Project and the Nizi Gold Project in the Democratic Republic of Congo.
• Exercise of the option would require issuance of a total of 350 million common shares (25 M initially, 325 M upon shareholder approval) and could trigger a change‑of‑control filing and trading halt on the CSE.
• The transaction includes additional cash and share purchase options for the remaining 10% interests in each project, as well as board representation rights for Amani Consulting and Mabanga Mining.

Key Details

• Option Structure:
• Initial issuance of 25 million shares to Amani Consulting and/or Mabanga upon signing a formal option agreement.
• Subsequent issuance of up to 325 million shares after shareholder approval, bringing total potential dilution to 350 million shares.
• Project Interests Acquired:
• 55% registered/beneficial interest in Giro Goldfields (initial) – up to 65% indirect interest overall.
• 55% interest in Nizi Gold Project (initial) – up to 65% indirect interest overall.
• Additional Purchase Options (exercisable within 12–24 months after closing):
• Giro: Pay US$30 M (12 mo) or US$50 M (24 mo) for remaining 10% of Giro Goldfields.
• Nizi: Pay US$30 M (12 mo) plus issue 50 million shares for additional 10% of Nizi Project.
• Financing & Loan Assumption:
• Mabanga previously lent USD 8 M to SOKIMO; USD 5.5 M already advanced.
• Upon raising a minimum of USD 40 M, DRC Gold will repay USD 5.5 M to Mabanga for the portion of the loan it assumes.
• Board Representation:
• After initial share issuance, Amani/Mabanga may appoint up to two directors; after full issuance, they may appoint additional candidates, potentially controlling three of five board seats.
• Regulatory Impact:
• Full exercise (350 M shares) will constitute a change‑of‑control under CSE Policy 1.3(2) and a Fundamental Change under CSE Policy 8, triggering an immediate trading halt until transaction closing.
• Escrow Requirement: Shares issued for this transaction will be placed in escrow per CSE requirements.
• Project Overviews (non‑material but included):
• Giro Gold Project: ~497 km² within Kilo Moto Greenstone Belt, near Kibali Mine; contains Kebigada and Douze Match deposits.
• Nizi Gold Project: 113 km² licence PE 5110 in Ituri District; includes historic King Leopold underground mine with up to seven quartz gold veins.
• Other Operational Update: Okote Gold Project in Ethiopia placed on hold indefinitely due to regional security concerns.

Notable Quotes

“We are very pleased that we now have been granted an option to acquire majority interests in both the Giro Gold Project and the Nizi Gold Project. Our team has a wealth of experience exploring mineral concessions in the DRC and we look forward to developing the potential of these two exciting projects.” – Klaus Eckhof, CEO, DRC Gold Corp.