Payments of CAD 2,075,000 are due in three tranches for the entire acquisition
Storm Exploration Inc. (TSX-V: STRM; FRA: L84) has successfully renegotiated and significantly improved its already expired earn-in agreement for the acquisition of the prospective Miminiska and Keezhik gold projects in Ontario. The vendor, Landore Resources Canada Inc., has agreed to extend the terms of the remaining payments under the option agreement to acquire a 100% interest in the properties by up to 18 months.
Accordingly, payments of CAD 2,075,000 are due in three tranches for the entire acquisition of the two projects, whereby Storm must pay a total of CAD 787,500 in cash and may pay up to CAD 1,287,500 in the form of shares at its own discretion. The earn-in process will therefore start on September 20, 2024 with a payment of CAD 262,500 plus CAD 250,000 in cash or shares. This will be followed by a second tranche on March 20, 2025, in which CAD 250,000 in cash or shares will be due. The final and largest payment of 525,000 cash and 787,000 in cash or shares would therefore be due on March 20, 2026. The number of Storm shares to be issued in each case is defined by the volume-weighted 30-day average share price prior to the payment date.
Unlike in the previous earn-in agreement with Landore, this time the Storm shares to be issued are subject to a voluntary pooling agreement. Under this agreement, Landore may sell 20% of each share installment upon issuance (subject to the statutory hold period), a further 40% on the first anniversary of the share issuance and the remaining 40% on the second anniversary of the share issuance. In addition, Storm has the option to find a buyer if Landore wishes to sell shares. If Landore acquires management or control of 10% or more of Storm’s issued shares, it will have the right to appoint a director to the board, subject to TSXV approval.
Bruce Counts, the Company’s President and CEO, stated, “I want to thank Landore for working with Storm to revise the agreement for Miminiska and Keezhik in a way that balances attractive commercial terms for Storm investors with value preservation for Landore.”
The Miminiska, Keezhik and Attwood properties are located in the traditional territory of the Eabametoong First Nation, with whom Storm has signed an exploration agreement. The property projects are located in the Miminiska-Fort Hope Greenstone Belt, approximately 350 kilometers north of the city of Thunder Bay, Ontario. Each project has the potential to host a multi-million ounce orogenic gold deposit. In addition, the Attwood project also has the potential to host a significant base metal deposit.
The Miminiska property is the Company’s primary focus and hosts drill-confirmed, high-grade gold mineralization in two primary prospect areas: Miminiska and Frond (see Figure 1). Historical assays returned 5.75 g/t Au over 20.84 m* and 13.95 g/t Au over 5.32 m* with mineralization hosted in a banded iron formation and associated shear zones.
Conclusion: With the new schedule and the option to pay the lion’s share of the payments at the end and in the form of shares, Storm has a new opportunity to successfully complete the earn-in for the two prospective gold-base metal projects Miminiska and Keezhik. In particular, the fact that Landore has agreed to a voluntary pooling agreement should signal to future Storm investors that Landore is fair and sees itself as a partner with a longer-term orientation. If exploration is successful, a stake in Storm could become a considerable asset for Landore, as the Miminiska project in particular has all the characteristics that one would wish for in a banded iron ore-gold project. The Musselwhite Mine, which is operated around 300 kilometers northwest of Newmont, is a model for the successful operation of a mine of such a type. It is considered one of the most profitable mines of Newmont, despite the fly-in-fly-out of personnel. Storm intends to announce its plans for earn-in funding and a drill program to expand the known mineralization at the Miminiska project in the coming days.
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