Business
Royal Road Minerals Enters into Letter of Intent with Mineros S.A. for Colombian Joint Venture
Toronto, Ontario--(Newsfile Corp. - December 23, 2019) - Royal Road Minerals Limited (TSXV: RY...
About this update from Royal Road Minerals Limited
[{"type":"text","content":"Royal Road Minerals Enters into Letter of Intent with Mineros S.A. for Colombian Joint VentureToronto, Ontario--(Newsfile Corp. - December 23, 2019) - Royal Road Minerals Limited (TSXV: RYR) (\"Royal Road\" or the \"Company\") is pleased to announce that it has entered into a Letter of Intent (the \"LOI\") with Mineros S.A. (\"Mineros\") in relation to the Company's Guintar and Niverengo concessions and its Margaritas title application (\"GNM Project\") in Antioquia District, Colombia. Mineros is a Colombian public company engaged in the business of gold mining and listed on the Colombian Stock Exchange. Royal Road currently operates in Nicaragua under a separate exploration strategic alliance formed in September 2017 with Mineros's subsidiary, Hemco Nicaragua S.A.Pursuant to the LOI, the parties intend to negotiate and enter into a definitive agreement (the \"Definitive Agreement\") as soon as practicable, but in any case before January 30, 2020. The LOI provides that the Definitive Agreement would contain the following basic terms:Mineros would pay to Royal Road the sum of USD $1 million on execution of the Definitive Agreement Mineros and Royal Road would agree to an initial exploration program and budget for the exploration of the GNM ProjectMineros would fund all exploration costs up to a total of USD $2.5 millionAfter spending at-least USD $1 million, Mineros would have the option to acquire 25% of the GNM Project and to transfer titles and title applications to a new special purpose company (the \"Project Company\"), initially to be owned as to 75% by Royal Road and as to 25% by MinerosAfter spending at least a total of USD $2.5 million, Mineros would acquire 50% of the Project Company and the parties would operate the Project Company on a joint venture basisThe parties would thereafter jointly fund the operations of the Project Company and the parties' respective interests would be subject to dilution under a standard formula, provided that if any party dilutes to 30%, it would have a one-time right to contribute any funding shortfall and restore its pre-dilution ownership interest If a party's interest is diluted to below 15%, such interest would convert to 1.5% net smelter royaltyThe Company would be the operator of the exploration of the GNM Project for so long as it maintains not less than a 50% ownership interest in...