Details of the transaction are as follows:
Private placement
Osisko will acquire 14 million flow-through common shares of NioGold for total proceeds of $4.9 million to NioGold, which will be listed for trading on the TSX Venture Exchange under the symbol "NOX" on closing.
Osisko will acquire these 14 million flow-through common shares of NioGold for investment purposes and other than these shares, Osisko has no current intention to increase the beneficial ownership of, or control or direction over, additional securities of NioGold. These shares are being acquired by Osisko pursuant to applicable exemptions from the prospectus requirements and will be subject to a four-month hold period.
Purchase of Right to Repurchase Marban and Malartic Hygrade-NSM Royalties
Osisko to pay $150,000 to purchase the rights held by NioGold to repurchase half of the existing net smelter return royalties on the Marban block and Malartic Hygrade-NSM block, consisting of:
- The right to repurchase for the price of $1,000,000:
- 0.25% NSR on the Marban claims
- 0.5% NSR on the First Canadian claims
- 1.0% NSR on the Norlartic claims
- The right to repurchase for the price of $1,000,000:
- 1.0% NSR on the Malartic Hygrade-NSM claims
- Upon closing of the transaction, Osisko will own 23,598,500 common shares of NioGold, or approximately 19.5% of NioGold’s issued and outstanding common shares. The definitive agreement for the transaction will also include the following key terms:
- NioGold to relocate its head office to Montréal, Québec
- NioGold board to be reconstituted to include two Osisko nominees, two NioGold nominees and one nominee to be jointly determined by Osisko and NioGold, for a total of five directors.
The transaction is subject to customary conditions, including the satisfactory completion of Osisko’s due diligence on NioGold’s assets, the negotiation and entering into by both parties of a definitive agreement and regulatory approval from the TSX Venture Exchange.
