First Mining grants Gainey option over Mexico property
TSX-V-listed Gainey Capital has signed an option agreement to earn a 100% interest in TSX-listed First Mining Gold’s Las Margaritas gold prospect, in Mexico.
The project comprises two mineral concessions encompassing a total of 500 ha.
First Mining president and CEO Jeff Swinoga said this transaction unlocked the unrealised value of the prospective, but under-explored gold property.
“Since First Mining is focusing on advancing the development of its Springpole gold prospect and Goldlund gold prospect, both in Ontario, entering this option agreement adds immediate value to the company’s shareholders while at the same time negating any holding costs on this property,” he noted.
Gainey is required to either issue $75 000 in shares as payment, initially, or pay $12 000. Upon the first anniversary date of the agreement, Gainey is required to either issue $175 000 in shares, or pay $28 000. Upon the second anniversary date of the agreement, Gainey is required to issue $250 000 in shares, or pay $40 000.
Upon the third and fourth anniversaries of the agreement, Gainey is required to either issue $225 000 in shares, or pay $36 000, on both occasions.
Further, Gainey will make yearly cash payments to First Mining of $25 000 from September 2018 to September 2020, and $250 000 in September 2021 in connection with an existing agreement on the property, and will incur exploration expenditures on the Las Margaritas property totalling $1-million over the four-year option period.
Upon payment completion, Gainey will obtain 100% ownership of the Las Margaritas property and First Mining will retain a 2% net smelter return royalty, with Gainey having the right to buy back 1% of the net smelter return royalty for $1-million, up until the first anniversary of the start of commercial production at the property.
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