Rupert Resources Ltd. (“Rupert” or the “Company”) reports that it has entered into an arm’s length, definitive agreement to joint venture the Company’s Gold Centre property in Red Lake, Ontario with Trillium Gold Mines Ltd (“Trillium” or “TGM”).
Rupert and Trillium will form an unincorporated joint venture with respect to the Gold Centre property. Trillium will have an 80% participating interest (a “Participating Interest”) in the joint venture and Rupert will have a 20% carried Participating Interest. In order to maintain its 80% Participating interest, Trillium will be required to spend CAD $2,000,000 per annum in each of the first five years and CAD $500,000 in each subsequent year. Further, Trillium will issue to Rupert 500,000 common shares upon the start date of the joint venture and on each anniversary thereof for the subsequent three years, for a total of 2,000,000 common shares. A management committee will be established comprising members from both Trillium and Rupert to administer decision making of the joint venture.
Rupert will not be required to contribute any funds for the benefit of the Joint Venture on account of its 20% carried Participating Interest. After the completion of a positive feasibility study and a decision to proceed to production, expenditures representing Rupert’s 20% Participating Interest will be treated as a loan by Trillium to Rupert (the “Carried Interest Loan”). The Carried Interest Loan is non-recourse against Rupert except through payment of Rupert’s 20% share of output from the Gold Centre property or of earnings from the production of minerals at the Gold Centre property. Rupert will have the right at any time to pay all, or any portion of, the amounts outstanding under the Carried Interest Loan without notice, bonus or penalty, provided that any such repayment is accompanied by all accrued but unpaid interest.
James Withall, Chief Executive of Rupert Resources said “This transaction fits with our aim to demonstrate the potential value of all the assets of the Company whilst also ensuring the Company can remain focussed on the Pahtavaara project that continues to yield significant new discoveries. Trillium have committed to spend at least CAD $10M over the first 5 years of the agreement at Red Lake and have defined an exploration strategy to target the potential extension of the Red Lake mine on to the property. Furthermore, Rupert Resources shareholders are free carried to a production decision, retain a 20% direct ownership in the asset and have a direct equity position in Trillium that has a portfolio of highly prospective projects in the Red Lake Mining Camp.”
For pdf of full release including further details of the transaction please follow the link below: