Sunridge Gold Signs Shareholder’s Agreement with ENAMCO for Asmara Copper-Zinc-Gold Project, Eritrea
Sunridge Gold Corp. (the “Company” or “Sunridge”) (SGC: TSX.V/SGCNF: OTCQX) is pleased to announce that Sunridge and the Eritrean National Mining Corporation (“ENAMCO”) have executed a shareholders’ agreement (the “Shareholders’ Agreement”) to organize and operate the Asmara Mining Share Company (“AMSCo”) the operating entity which will own and operate the Asmara copper-zinc-gold mining project (the “Property”) in Eritrea.
AMSCo will be owned 60% by Sunridge and 40% by ENAMCO (30% participating and 10% free carried interest) and will have a board of directors of five, comprising three from Sunridge and two from ENAMCO. All future project development or exploration costs will be shared two-thirds Sunridge and one-third ENAMCO.
Michael Hopley, President and CEO of Sunridge said “Signing the AMSCo shareholder agreement is another major milestone that we have now achieved in the development of the Asmara mine. The payments from ENAMCO to Sunridge totaling US$5 million over the next few months, together with the relief from having to fund our in-country programs through AMSCo for the next US$6 million of expenditures, will provide Sunridge with a healthy treasury. We are very pleased to have ENAMCO as our partner and look forward to a continued close working relationship.”
On February 4, 2014, Sunridge announced that it had signed a binding term sheet for the purchase of the 30% participating interest pursuant to which ENAMCO agreed to pay Sunridge US$18.33 million in stages prior to production. Pursuant to the Shareholders’ Agreement, ENAMCO has now agreed to pay the first US$5 million of the purchase price on the following accelerated schedule:
- US$2 million to be paid immediately on signing the Shareholders’ Agreement
- US$1 million by September 30, 2014
- US$1 million by October 30, 2014
- US $1 million by November 30, 2014
The balance of the US$13.33 million will be paid in installments beginning upon signing a finance agreement that secures a significant portion of the financing required to develop the Property (the “Financing Agreement”);
- US$6 million to be paid upon on signing the Financing Agreement
- US$4 million 6 months after signing the Financing Agreement
- US$3.3 million 12 months after signing the Financing Agreement
In the Shareholders’ Agreement, the parties have agreed that ENAMCO will contribute one-third of the funding of expenditures on the project, including exploration and development retroactive to July 4, 2012, the date ENAMCO delivered its notice of intention to exercise its full purchase option. Since then, Sunridge has contributed approximately US$12 million to the project and now ENAMCO has agreed to fund the next approximately US$6 million to AMSCo for their portion of retroactive contributions to the project. The terms of the Shareholders’ Agreement also contain all the normal provisions regarding the governance and operations of AMSCo.
ABOUT SUNRIDGE:
Sunridge is a mineral exploration and development company focused on the acquisition, exploration, discovery and development of base and precious metal projects on the Asmara Project in Eritrea. Sunridge currently has approximately 210 million shares outstanding and trades on the TSX Venture Exchange under the symbol SGC. For additional information on the Company and its projects please view the slide show on our website at www.sunridgegold.com or call Greg Davis at the number listed below.
| SUNRIDGE GOLD CORP. | |
| “Michael Hopley” | For further information contact: |
| Michael Hopley, President and Chief Executive Officer | Greg Davis, VP Business Development |
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| Email: greg@sunridgegold.com Tel: 604-688-1263 (direct) |
| Neither the 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. | |
This news release contains forward-looking statements that are based on the Company’s current expectations and estimates. Forward-looking statements are frequently characterized by words such as “plan”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “suggest”, “indicate” and other similar words or statements that certain events or conditions “may” or “will” occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated events or results implied or expressed in such forward-looking statements. Forward looking statements may include the timing and success of any application for a mining license or of debt financing and completion of definitive documentation with ENAMCO. Risk and uncertain factors include, among others: the actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters as plans to continue to be refined; possible variations in ore grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, a mining license, or debt financing, uncertainties in negotiating commercial arrangements with government entities; and fluctuations in metal prices. There may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
Contact
Sunridge Gold Corp.
Greg Davis, 604-688-1263 (direct)
VP Business Development
greg@sunridgegold.com