ELY's proposed purchase of Watershed Royalty Gold Royalties agreed to purchase a 1% net smelter returns royalty on mining claims in Ontario, Canada from Sanatana Resources Inc. (TSXV, STA, Not Rated). The Watershed Royalty surrounds the Cote Gold Project which is a joint venture between IAMGOLD (NYSE, IAG, Not Rated) and Sumitomo Metal Mining Company.
Completion of the royalty sale is subject to: 1) receipt by Sanatana of a waiver from IAMGOLD of its right of first refusal (ROFR), 2) negotiation of a definitive agreement, and 3) approval of the TSX Venture Exchange (TSXV). In the event IAMGOLD exercises the ROFR, Sanatana will pay a break-up fee of C$500 thousand to Ely Gold.