Bonterra and Osisko seal the deal on Urban-Barry

"Bonterra is poised for an exciting new chapter in the development of our Urban-Barry property and the surrounding Duke and Lac Barry properties," Cesar Gonzalez, Executive Chairman of Bonterra, said. "With Osisko's substantial $30 million investment over three years and deep understanding of this prolific gold camp, we expect to unlock the full exploration potential of the Properties. Importantly, the earn-in and joint venture agreement does not include the Bachelor-Desmaraisville property, which hosts the Bachelor Mill Complex and where exploration drilling is ongoing and 10,000 meters are expected to be drilled before year end."

Bonterra Resources Inc. has entered into a binding letter agreement (the "Letter Agreement") with Osisko Mining Inc. ("Osisko") for an exploration earn-in and joint venture agreement on its Urban-Barry property (host to the Gladiator and Barry deposits), in addition to the adjoining Duke and Lac Barry properties (together, the "Properties"), all located in Québec's Eeyou Istchee James Bay region. The Duke property is currently 70% owned by Bonterra and 30% owned by Osisko, and the Lac Barry property is currently 85% owned by Bonterra and 15% owned by Gold Royalties Corp. The Properties total 496 claims over 22,508 hectares.

Key Highlights of the Proposed Joint Venture

The earn-in and joint venture, which will be formalized by the parties executing a definitive exploration earn-in and joint venture agreement (the "Definitive Agreement"), will provide the terms for the advancement of the Properties through a $30 million investment by Osisko over a three-year period. The Letter Agreement provides that, subject to the execution of the Definitive Agreement, Osisko will have the ability to earn a 70% interest in the Properties on the following terms:

• An initial up-front payment of $5 million ($1 million on the first business day after signing the Letter Agreement and $4 million upon execution of the Definitive Agreement);

• Completion of $30 million in work expenditures on the Properties, with a minimum spending commitment of $10 million per year over the three year period following the execution of the Definitive Agreement;

• Osisko will have the right to carry over work expenditures from year to year, and to pay cash in lieu of expenditures in the event of a shortfall;

• Osisko will be the operator for the Properties during the exploration earn-in period;

• Once a 70% interest in the Properties is earned by Osisko, the Properties will be operated as a joint venture (the "Joint Venture"), with Osisko as the operator, and each party required to contribute to future work expenditures in accordance with their proportional interests in the Joint Venture; and

• Dilution of a party to less than 10% of the Joint Venture will result in the conversion of their respective Joint Venture interest to a 1% net smelter return royalty.

 

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