Business
Royal Road Minerals Announces Closing of Luna Roja Sale
Toronto, Ontario--(Newsfile Corp. - May 21, 2021) - Royal Road Minerals Limited (TSXV: RYR) ...
About this update from Royal Road Minerals Limited
[{"type":"text","content":"Royal Road Minerals Announces Closing of Luna Roja SaleToronto, Ontario--(Newsfile Corp. - May 21, 2021) - Royal Road Minerals Limited (TSXV: RYR) (\"Royal Road\" or the \"Company\") is pleased to announce that the Company has completed the sale to Hemco Nicaragua S.A. (\"Hemco\"), a subsidiary of Mineros S.A., of its entire 50% interest in the Luna Roja Project, comprising the Monte Carmelo I and Monte Carmelo II mining concessions, in Nicaragua. The Luna Roja Project had previously been jointly owned and operated by the Company and Hemco, pursuant to the terms of a strategic alliance agreement (the \"Strategic Alliance Agreement\") dated September 1, 2017 between the Company and Hemco, as amended. Under the terms of the transaction, the Company sold its 50% interest in the Luna Roja Project on the following key terms: Purchase Price - The Company received the following consideration for the sale of its interest in the Luna Roja Project: (i) US$24,485,294 million, of which $20,812,000 was paid in cash on the closing of the transaction and the remaining US$3,672,794 amount was retained by Hemco to be remitted to the applicable governmental authorities in accordance with applicable withholding tax requirements under Nicaraguan law, and (ii) a 1.25% net smelter return royalty on all future mineral production from the Monte Carmelo I and Monte Carmelo II mining concessions, commencing from the first commercial production therefrom. Expenditure Commitment - The Company agreed to incur, during the five-year period ending May 21, 2026, not less than US$7.5 million in expenditures pursuant to exploration programs and budgets approved by a joint Hemco/Company management committee pursuant to the Strategic Alliance Agreement.Upon closing, the Strategic Alliance Agreement was amended to, among other things, remove the Monte Carmelo I and Monte Carmelo II mining concessions from the area of interest that is subject to the alliance. The Strategic Alliance Agreement, as amended, will continue in effect, including with respect to the jointly-owned Caribe Project, and the Company's other joint projects with Hemco in Nicaragua operated thereunder. The transaction was completed on May 21, 2021. Cautionary statement:This news release contains certain statements that constitute forward-looking information and forward-looking statements within the ...