GoldMining Options The Almaden Property to NevGold for Total Consideration of $16.5 Million AND Makes Strategic Investment in NevGold This news release constitutes a "designated news release" for the purposes of the Company's prospectus supplement dated
GoldMining Options The Almaden Property to NevGold for Total
Consideration of $16.5 Million AND Makes Strategic Investment in NevGold
This news release constitutes a "designated news release" for the purposes of the Company's prospectus supplement dated
December 10, 2021
to its short
form base shelf prospectus dated
October 27, 2021
.
VANCOUVER, BC
,
June 14, 2022
/CNW/ - GoldMining Inc. (the "
Company
" or "
GoldMining
") (TSX: GOLD) (NYSE American: GLDG) is pleased to announce
that it has entered into an option agreement (the "
Option Agreement
") with NevGold Corp. and its subsidiary ("
NevGold
"; (TSXV: NAU) whereby NevGold's
subsidiary may acquire a 100% interest in the Company's Almaden Project, located in
Idaho, U.S.A.
The Agreement provides for total cash and/or share
consideration to the Company from NevGold of up to
C$16.5 million
, which is comprised of initial consideration of
C$3 million
, additional payments of
C$6.0 million
to exercise the Option and further contingent payments of up to
C$7.5 million
tied to success-based project milestones.
Key Option Agreement Highlights
On closing, NevGold will issue 4,444,444 common shares of NevGold (the "
NevGold Shares
") to GoldMining representing
C$3 million
of value at a price
equal to
C$0.675
per share, representing approximately 10.6% of the outstanding NevGold Shares as of the date hereof;
GoldMining will subscribe for an additional
$1 million
of NevGold Shares at
$0.675
/share for 1,481,481 common shares on closing of the Option Agreement,
and commits to a further lead order in a future financing by NevGold completed by
November 30, 2022
in an amount to the lesser of
C$1.25 million
and 40%
of the total gross proceeds raised by NevGold in the Financing;
In order to exercise the option, NevGold must make the following additional payments to GoldMining's subsidiary in cash and/or NevGold Shares (based on a
30 day VWAP):
January 1, 2023
:
C$1.5 million
July 1, 2023
:
C$1.5 million
January 1, 2024
:
C$3.0 million
To exercise the Option, NevGold must also make qualifying expenditures on the Project totalling
C$2.25 million
:
$1.5 million
on or before
June 1, 2023
$0.75 million
on or before
December 31, 2023
Upon satisfying the total
C$9.0 million
in cash and/or share payments and completing
C$2.25 million
in qualifying expenditures by
January 1, 2024
, NevGold
would own 100% of the Project
Additionally, NevGold is required to make success-based contingent payments totalling up to
C$7.5 million
to GoldMining, payable in cash or shares at the
election of NevGold:
C$0.5 million
on completion of a positive Preliminary Economic
Assessment
C$2.5 million
on completion of a positive Preliminary Feasibility Study
C$4.5 million
on completion of a positive Feasibility Study
Alastair Still
, CEO of GoldMining, commented, "In
March 2020
with gold near
$1,620
/oz, we acquired the Almaden project for
C$1.15 million
, and currently
Almaden represents only 3% of our current overall resource base. Today's transaction with NevGold for total consideration of
C$16.5 million
, represents a
significant return for our shareholders and demonstrates the substantial value embedded in our large resource portfolio which was acquired for the most part
when gold was less than
$1,350
/oz and copper near
$2
/lb. The structure of this deal with NevGold presents a 'win-win', providing us with exposure to the future
success and upside potential of the Almaden Project and providing NevGold with a new strategic investment. Furthermore, through our strategic investment and
NevGold Share consideration, we have additional exposure to work conducted by NevGold to advance its portfolio of assets in the region, including its active
exploration drilling at Limousine Butte in
Nevada
."
The Option Agreement
Pursuant to the Option Agreement, on closing of the transaction, GoldMining will grant a subsidiary of NevGold an option to acquire a 100% interest in the project
for initial consideration for such grant of
C$3.0 million
, which will be satisfied through the issuance of 4,444,444 NevGold Shares. Pursuant to the option, in order
to acquire the project, NevGold must: (i) make additional payments of
C$6 million
to the Company, payable in cash and/or NevGold Shares, at the election of
NevGold; and (ii) complete qualifying expenditures of
C$2.25 million
at the project during an exercise period ending
January 1, 2024
. The Option Agreement
provides for additional contingent payments of up to
C$7.5 million
by NevGold, payable in cash and/or NevGold Shares, at the election of NevGold. In the event
that any of the foregoing payments are satisfied through the issuance of additional NevGold Shares, the number of such shares will be based upon the volume
weighted average price of the NevGold Shares for the applicable 30-trading day period.
Strategic Investment
I
n addition, concurrently with the closing of the option grant, GoldMining will make a strategic investment in NevGold by subscribing for 1,481,481 NevGold Shares
at a price of
C$0.675
per NevGold Share for total subscription proceeds of
C$1 million
. Under the Option Agreement, GoldMining has agreed to purchase
additional NevGold equity in an amount to the lesser of
C$1.25 million
and 40% of the total gross proceeds raised by NevGold in the event NevGold completes a
qualifying financing prior to
November 30, 2022
. In connection with the transaction, on closing, the parties will enter into an investor rights agreement on customary
terms, which provides for, among other things, the grant of certain anti-dilution rights by NevGold to GoldMining and the right to nominate one board member of
NevGold, provided the Company maintains an equity interest in NevGold above 4.9%.
Closing of the Option Agreement is expected to occur in
June 2022
and is subject to customary regulatory approvals. Upon closing, GoldMining is expected to
own approximately 10.6% of the outstanding NevGold Shares based on the number of NevGold Shares issued and outstanding as of the date hereof.
About GoldMining Inc.
GoldMining Inc. is a public mineral exploration company focused on the acquisition and development of gold assets in the Americas. Through its disciplined
acquisition strategy, GoldMining now controls a diversified portfolio of resource-stage gold and gold-copper projects in
Canada
,
U.S.A.
,
Brazil
,
Colombia
, and
Peru
. The Company also owns more than 20 million shares of Gold Royalty Corp. (NYSE American: GROY).
Forward-looking Statements
This document contains certain forward-looking statements that reflect the current views and/or expectations, including statements regarding the expected closing
of the Option Agreement, future payments under the Option Agreement, expectations regarding NevGold's proposed work programs and the expected benefits of
the transactions under the Option Agreement. Forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and
forecasts about the business and the markets in which GoldMining operates. Investors are cautioned that all forward-looking statements involve risks and
uncertainties, including: delays to plans caused by restrictions and other future impacts of COVID-19 or any other inability of the Company to meet expected
timelines for planned project activities; results of exploration programs may not confirm expectations; the inherent risks involved in the exploration and development
of mineral properties, fluctuating metal prices, the ability of the parties to satisfy the conditions to closing of the Option Agreement as contemplated, the ability of
NevGold to exercise the option under the Option Agreement, unanticipated costs and expenses, risks related to government and environmental regulation, social,
permitting and licensing matters, and uncertainties relating to the availability and costs of financing needed in the future. These risks, as well as others, including
those set forth in GoldMiningꞌs Annual Information Form for the year ended
November 30, 2021
, and other filings with Canadian securities regulators and the U.S.
Securities and Exchange Commission, could cause actual results and events to vary significantly. Accordingly, readers should not place undue reliance on
forward-looking statements and information. There can be no assurance that forward-looking information, or the material factors or assumptions used to develop
such forward-looking information, will prove to be accurate. The Company does not undertake any obligations to release publicly any revisions for updating any
voluntary forward-looking statements, except as required by applicable securities law.
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https://www.prnewswire.com/news-releases/goldmining-options-the-almaden-property-to-nevgold-for-total-consideration-of-16-5-million-and-makes-strategic-investment-in-nevgold-301567486.html
SOURCE
GoldMining Inc.
View original content:
http://www.newswire.ca/en/releases/archive/June2022/14/c4269.html
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For further information:
GoldMining Inc., Amir Adnani, Chairman, Alastair Still, CEO, Telephone: (855) 630-1001, Email: [email protected]
CO: GoldMining Inc.
CNW 08:00e 14-JUN-22