Mandalay Resources Corporation Announces Non-Binding Heads of Agreement with Equus Mining for the Option to Acquire the Cerro...
June 26 2019 - 7:30AM
Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX:
MND, OTCQB: MNDJF) is pleased to announce that it has entered into
a non-binding Heads of Agreement with Equus Mining (“Equus”)
whereby Equus has a 3-year period (“Option Period”) to explore at
the 29,495 hectare Cerro Bayo mine district in Region XI, Southern
Chile. The Heads of Agreement contemplates an Option Period in
which Equus can exercise its option to acquire all the issued share
capital of Compania Minera Cerro Bayo Ldta. (“CMBC”), including its
mining properties, resources and mine infrastructure at Cerro Bayo,
as well as the 1,500 tpd processing plant, which is currently on
care and maintenance. The Heads of Agreement has a condition that
at 18 months both parties have the right to terminate the
agreement.
Should Equus exercise its option to acquire CMBC, consideration
to Mandalay consists of:
- the issue to Mandalay of 19% of Equus’ share capital; and
- a 2.25% net smelter royalty on production from the Cerro Bayo
mining claims once the mine has produced at least 50,000 ounces of
gold equivalent, subject to a re-purchase option in favour of
Equus.
In addition, Equus will assume 50% of the
approved site closure costs at Cerro Bayo.
Completion of the transaction is subject to a
number of conditions precedent, including execution of definitive
agreements in respect of the transaction, third-party consents, and
the approval by the Board of Directors of both companies.
For Further Information:
Dominic DuffyPresident and Chief Executive
Officer
Greg DiTomasoDirector of Investor Relations
Contact: 647.260.1566
About Mandalay Resources
Corporation:
Mandalay Resources is a Canadian-based natural
resource company with producing assets in Australia and Sweden, and
care and maintenance and development projects in Chile. The Company
is focused on growing production at its gold and antimony operation
in Australia, and gold production from its operation in Sweden to
generate near term cash flow.
About Equus Mining Limited:
Equus Mining Limited (ASX: EQEO0.12) is an
Australian Exploration and Development Company listed on the
Australian Securities Exchange. Equus is focused primarily on the
exploration and development of gold-silver-polymetallic projects in
the politically stable and supportive mining jurisdiction of XI
Region, Southern Chile. Equus’ projects are strategically located
in the northwestern portion of the highly prospective, world class
Deseado Massif precious metal district, near existing underutilized
mine and processing infrastructure.
Forward-Looking Statements:
This news release contains "forward-looking
statements" within the meaning of applicable securities laws,
including statements regarding the proposed sale of Cerro Bayo to
Equus Mining Limited. There is no assurance that the proposed
transaction will be completed on the terms set out in this press
release or at all. Actual results and developments may differ
materially from those contemplated by these statements depending
on, among other things, changes in commodity prices and general
market and economic conditions. The factors identified above are
not intended to represent a complete list of the factors that could
affect Mandalay. A description of additional risks that could
result in actual results and developments differing from those
contemplated by forward-looking statements in this news release can
be found under the heading “Risk Factors” in Mandalay’s annual
information form dated March 28, 2019, a copy of which is available
under Mandalay’s profile at www.sedar.com. In addition, there can
be no assurance that any inferred resources that are discovered as
a result of additional drilling will ever be upgraded to proven or
probable reserves. Although Mandalay has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements.
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