2013-01-25 21:03:50 -
TORONTO, ONTARIO -- (Marketwire) -- 01/25/13 -- Unigold Inc. ("Unigold" or the "Company") (TSX VENTURE:UGD) is pleased to announce that it has entered into an agreement (the "Consent Agreement") with Malbex Resources Inc. ("Malbex") (TSX VENTURE:MBG) whereby Unigold has provided its consent to the acquisition of Americana de Explotaciones Mineras S.R.L. ("Americana") by Malbex. Americana holds the concession on the 13,386 hectare Los Guandules Verdes property (the "Property") located in the Municipalities of Elias Pina and Dajabon, Dominican Republic, directly south of Unigold's Neita property. Unigold had previously entered into an option agreement with Americana giving it the right to acquire either the concession comprising the Property or all the issued and outstanding equity interests in the capital of Americana.
In exchange for Unigold consenting to the acquisition, Malbex has agreed to: (i) issue to Unigold 13,000,000 common shares in the capital of Malbex (the "Malbex Shares"); and (ii) grant to Unigold a 2% net smelter returns royalty in respect of all minerals produced from the Property (the "NSR"). Half of the NSR may be repurchased by Malbex for $1,000,000 which would leave Unigold with a royalty equal to 1% of net smelter returns. Additional consideration of 5,000,000 common shares of Malbex will be issued to Unigold in the event that Malbex, within the period commencing on the date upon which Americana is issued the concession agreement in respect of the Property and ending five years thereafter, delineates 2,000,000 ounces of gold from the Property on a National Instrument 43-101 compliant basis in the measured and/or indicated mineral resource categories. All such common shares of Malbex which may be issued to Unigold pursuant to the Consent Agreement will be subject to a hold period which will run for a period of four months from the time of the issue of such common shares.
The closing of the transaction contemplated by the Consent Agreement remains subject to the final approval of the TSX Venture Exchange and the shareholders of Malbex. In addition, the issuance of the Malbex Shares and the grant of the NSR are conditional on the closing of the acquisition and the issuance to Americana of the concession agreement in respect of the Property. The transaction involves non-arm's length parties. Malbex is considered a non-arm's length party of Unigold as a result of the fact that Joseph Andrew Hamilton is a director of each of Unigold and Malbex.
Unigold's Board of Directors has decided to consent to the acquisition of the Property by Malbex as it is a non-core holding. "This deal is strategic for Unigold and allows our shareholders to participate through the 13-million shareholding in any discovery at Los Guandules. We are also very pleased to have helped attract a new exploration company, Malbex, to the Dominican Republic," comments Andrew Cheatle, President and CEO Unigold. "Unigold is appropriately focused on exploring and developing the over 21 identified high quality and high priority targets on Neita, including the Candelones and Candelones Extension discoveries."
Premier Mining Destination - Dominican Republic
The Dominican Republic is host to world-class gold and base metal mines and deposits. The government supports development and exploration in the mining sector. In addition, the country has well-established mining and environmental laws. Unigold's wholly-owned flagship property, Neita, is compliant with all mineral and environmental requirements and work is conducted to internationally accepted environmental and social standards. The Neita concession exploration license was renewed in 2012 and is in good standing.
Unigold is well-funded with approximately $8.0-million in cash.
About Unigold Inc. - Discovering Gold in the Caribbean
Unigold is a Canadian based mineral exploration company traded on the TSX Venture Exchange under the symbol UGD, focused primarily on exploring and developing its gold assets in the Dominican Republic.
For further information, please visit www.unigoldinc.com.
Certain statements contained in this document, including statements regarding events and financial trends that may affect our future operating results, financial position and cash flows, may constitute forward-looking statements within the meaning of the federal securities laws. These statements are based on our assumptions and estimates and are subject to risk and uncertainties. You can identify these forward-looking statements by the use of words like "strategy", "expects", "plans", "believes", "will", "estimates", "intends", "projects", "goals", "targets", and other words of similar meaning. You can also identify them by the fact that they do not relate strictly to historical or current facts. We wish to caution you that such statements contained are just predictions or opinions and that actual events or results may differ materially. The forward-looking statements contained in this document are made as of the date hereof and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ materially from those projected in the forward-looking statements. Where applicable, we claim the protection of the safe harbour for forward-looking statements provided by the (United States) Private Securities Litigation Reform Act of 1995.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Mr. Andrew M. Cheatle, P.Geo
President & CEO
Ms. Amanda Dillon