Canadian GoldCamps has signed a definitive agreement with F3 Uranium’s subsidiary, F4 Uranium, to earn up to a 70% stake in the Murphy Lake Property in the Athabasca Basin, Saskatchewan.
The property spans around 6.1km² and is located near significant uranium deposits.
Once completed, the transaction will be classified as a “fundamental change” for Canadian GoldCamps, as per Canadian Securities Exchange (CSE) policies.
This necessitates approval from the majority of Canadian GoldCamps’ shareholders.
Post-transaction, the company aims to list on the CSE as a mining issuer, with a primary focus on exploring and developing the Murphy Lake Property.
The resulting issuer, the entity to emerge post-transaction, will operate under a new name, yet to be decided by Canadian GoldCamps.
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Shareholding patterns are expected to change, with current shareholders of Canadian GoldCamps holding around 90.1%, F4 holding 9.9%, and new shareholders from the financings holding approximately 62% of the common shares of the Resulting Issuer.
To secure an initial 50% interest, Canadian GoldCamps has made a non-refundable cash payment of $100,000 (C$136,823) to F4, with an additional $200,000 due upon shareholder approval of the transaction on 26 July 2024.
To maintain the option, Canadian GoldCamps must also make further non-refundable payments totalling $600,000 and incur $10m in aggregate expenditures.
The company may carry over any excess expenditures from one year to the next, with all eligible expenditures being credited towards the Property with governmental authorities.
To uphold the initial option, Canadian GoldCamps must issue shares to F4, representing 9.9% of its total issued and outstanding common shares, after raising at least $6m through equity financings.
These shares will be fully paid and non-assessable, subject to a four-month resale restriction.
Failure to issue these shares as scheduled may lead to the termination of the Initial Option.
Once the company earns 50% interest, both parties will enter a joint venture to further explore and potentially develop the property into a commercial mine.
To acquire an additional 20% interest, Canadian GoldCamps must make cash payments totalling $500,000 and incur an additional $8m in expenditures within 36 months of the initial payment date. Alternatively, the company can opt to make cash payments in lieu of expenditures.
Upon exercising the initial and bump-up options, F4 will receive a 2% net smelter royalty, with Canadian GoldCamps’ responsibility for the royalty proportionate to its interest in the property.
Prior to finalising the transaction, Canadian GoldCamps plans a non-brokered private placement, offering up to 16,000,000 hard dollar subscription receipts at C$0.25 each and up to 11,111,111 charity flow-through subscription receipts at C$0.36 each.
The gross proceeds from the offering will be held in escrow by Endeavor Trust Corporation until the transaction’s conditions are met.
