Cedar Mountain Acquires Alaskan Gold Project
EDMONTON, Alberta. Cedar Mountain Exploration Inc. (“Cedar”) is pleased to announce that its wholly-owned subsidiary, Cedar Mountain Exploration (Alaska) Inc. (“Cedar Alaska”) has entered into an agreement (the “Agreement”) with an arms-length party (the “Vendor”) to lease, with an option to purchase, a gold exploration project (the “Project”) located in the State of Alaska, USA.
Pursuant to the Agreement, Cedar Alaska may lease the Project from the Vendor by paying aggregate lease payments of US$1 million and incurring US$2.15 million in work commitments over 6 years. Cedar Alaska has the option to purchase (“Option”) 100% of the Project at any time within those 6 years for US$1.5 million, with all lease payments paid prior to exercise of the Option being deducted from the purchase price. Upon exercise of the Option, Cedar Alaska shall not be obligated to make further work commitments. Cedar Alaska must also maintain the Project in good standing and may terminate the lease at any time.
The Vendor will retain a production royalty equal to 5% of the net smelter returns (“NSR”). Cedar Alaska shall make annual advance royalty payments to the Vendor of US$100,000 upon exercise of the Option, US$100,000 on the first anniversary of the exercise of the Option, and US$200,000 on or before each subsequent anniversary of the exercise of the Option.
Cedar Alaska may purchase up to 3/5 of the Vendor’s retained royalty - thereby reducing the NSR from 5% down to a minimum of 2% - by paying the Vendor a the sum of US$2 million for each 1% NSR purchased. Upon any purchase of the NSR by Cedar Alaska, the advance minimum royalty payments shall be adjusted proportionately.
Subject to approval by the TSX Venture Exchange, Cedar has agreed to pay a finder’s fee to an arm’s length third party (the ”Finder”), for a total consideration of US$70,000 including an aggregate cash payment of US$55,000 together with the issuance of US$15,000 of common shares of Cedar (“Common Shares”) over a period of 5 years and conditional upon the continuation of the Agreement with the Vendor. Should Cedar Alaska choose to exercise the Option, the full finder’s fee is payable to the Finder within 30 days.
About Cedar Mountain Exploration Inc.
CEDAR MOUNTAIN EXPLORATION INC. (CED: TSX-V) is a junior mineral exploration company with gold and base metal projects in North America. In addition to advancing its existing properties, the Company continues to evaluate opportunities globally. Cedar is a member of the Discovery Group of Companies.
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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.