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Canadian Silver Hunter enters into option agreement to acquire Lost Dog Property

Oct 27, 2020


Canadian Silver Hunter has entered into a definitive option agreement with a director of the company, wherein the company has been granted the exclusive right and option to acquire a 100% interest in the Lost Dog property in Denton Township, Northern Ontario.

Pursuant to the terms of the Option Agreement, the total aggregate consideration payable by the Company to Mr. Towers is an aggregate of $65,000 in cash over three years and the issuance of an aggregate of 1,000,000 common shares in the capital of the Company, payable as follows:

  • upon signing the Option Agreement, the Company paid $5,000 in cash and issued 250,000 common shares;
     
  • on or before August 4, 2021, the Company shall have performed assessable work on the Property in the amount of $25,000;
     
  • on or before October 1, 2021, the Company shall pay an additional $10,000 in cash and issue an additional 250,000 common shares (the "October 2021 Shares"), and shall have completed work expenditures of $50,000 on the Property by August 4, 2022; and
     
  • on or before October 1, 2022, the Company shall pay an additional $50,000 in cash and issue an additional 500,000 common shares (the "October 2022 Shares") and shall have completed $50,000 assessable work on the Property and performed all of the exploration expenditures on a cumulative basis by August 4, 2023.

All of the common shares issued in connection with the Option Agreement are subject to a four-month statutory hold period from the date of issue in accordance with applicable securities legislation. The issuance of the October 2021 Shares and the October 2022 Shares to Mr. Towers remain subject to receiving disinterested shareholder approval, which the Company will be seeking at its next annual and special meeting of shareholders. 

The Option Agreement constitutes a "related party transaction" as defined in Multilateral Instrument 61-101 - Protection of Minority Securityholders in Special Transactions ("MI 61-101") and Policy 5.9 of the TSXV, as Mr. Towers is a director of the Company. The Company is relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101, as the fair market value of the common shares being issued to Mr. Towers in connection with the Option Agreement does not exceed 25% of the market capitalization of the Company, as determined in accordance with MI 61-101.

In addition, the Company announces the closing of a non-brokered private placement financing for gross proceeds of $56,000 (the "Offering") through the issuance of 700,000 units (each, a "Unit") at a price of $0.08 per Unit. Each Unit is comprised of one common share (each, a "Common Share") in the capital of the Company and one-half of one Common Share purchase warrant (each whole warrant, a "Warrant"). Each Warrant entitles the holder thereof to acquire one Common Share at a price of $0.12 until October 26, 2021. 

Proceeds from the sale of the Units will be used for general working capital and exploration purposes. The securities issued upon closing of the Offering are subject to a four-month statutory hold period until February 27, 2021, in accordance with applicable securities legislation.

 



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