Yale to Option Out the Urique Property -- Five Projects Now under Option9/14/2011 9:29 AM - Business Wire
VANCOUVER, British Columbia, Sep 14, 2011 (BUSINESS WIRE) --
Yale Resources Ltd. (Pink Sheets: YRLLF) (TSX-V - YLL and Frankfurt - YAB) is pleased to report that it has signed and formalized an Option Agreement with Mammoth Capital Corp. -- a Capital Pool Company -- for Yale's wholly owned Urique Property located in Chihuahua State, Mexico.
Under the terms of the Option Agreement, in order to earn a 70% interest in the property Mammoth will be required to pay Yale $50,000 ($25,000 received), issue to Yale 1,800,000 shares in Mammoth, and incur a total of $3,000,000 in exploration expenditures on the Property over a four year period.
Mammoth must issue 200,000 common shares upon receipt of Exchange approval to the proposed qualifying transaction and must issue a further 100,000 shares within 6 months of such approval. Subsequent share issuances of 300,000 at the 12 month anniversary and 400,000 on each subsequent anniversary will also be due in order to keep the Option Agreement in good standing. The first year's requirement will be $300,000 in exploration expenditures followed by a further $500,000 in the following year, $800,000 in the third year and $1,400,000 in the final year of the Option Agreement.
In order to earn the remaining 30% interest in the Property, Mammoth must issue an additional 500,000 common shares to Yale and must have completed a resource estimate on the Property delineating at least 300,000 equivalent ounces of gold in the measured and indicated categories within an additional three years. Upon completion of the resource estimation Mammoth would then be required to issue an additional share for each equivalent ounce of gold within the measured and indicated categories, subject to a minimum of 300,000 shares and a maximum of 2,000,000 shares.
"This is a great deal for the Company and Yale's shareholders as Mammoth will build on Yale's previous success at Urique. Continued success at Urique will allow Yale to become a significant shareholder in Mammoth and leverage the upside potential of the property", stated Ian Foreman, P.Geo., president of Yale.
If Mammoth elects not to proceed to earn the remaining 30% interest in the Property, the parties will form a 70-30 joint venture and will contribute to further exploration in accordance with their respective joint venture interest.
Yale will be the operator for the project during at least the first year of the Agreement and as such will charge Mammoth a management fee for all work performed on the Property.
About Yale Resources:
Yale Resources utilizes the project generator business model to maximize its exposure to discovery while minimizing shareholder risk. Yale currently has nine projects in its portfolio of which five are optioned out with commitments totalling approximately $1.3 M in expenditures during the next 12 months. At the same time Yale continues to work on its non-optioned properties as well as reviewing new projects.
Ian Foreman, P.Geo, is the Qualified Person, according to National Instrument 43-101, for the Urique Project and is responsible for the technical data mentioned in this news release.
On behalf of the Board,
"Ian Foreman"