BWR Exploration Inc. executed a definitive acquisition agreement with Puma Exploration Inc. to acquire a 100% interest in the latter's Little Stull Lake gold project in Manitoba.
Under the terms, BWR will be required to pay a total of C$150,000 in three tranches to Puma as well as issue 10 million BWR common shares, according to an Oct. 7 release.
The first tranche comprising C$50,000 has been paid to Puma upon signing of the letter of intent, giving BWR a 30-day exclusive due diligence period to allow for the evaluation of the project and negotiation of a definitive agreement.
Puma is entitled to receive the remaining installments of C$50,000 each when the Edmund Lake and Kistigan mineral exploration licenses are transferred to BWR.
Meanwhile, the first 5 million BWR shares of the deal's share consideration will be issued upon the parties' execution of a definitive agreement, and on receiving exchange approval.
The remaining 5 million shares will be issued upon BWR's completion of certain development milestones.
BWR will also be required to spend C$1.5 million in exploration within the first 36 months of the effective date, whilst failure to do so will result in the issuance of an additional 5 million shares to Puma.
As agreed earlier, Puma has nominated Marcel Robillard to the BWR board. He will be appointed to the board upon the closing of the transaction.
Puma will retain a 1% non-buyable NSR if commercial production is achieved at Little Stull Lake. Meanwhile, BWR has assumed the right of first refusal to an underlying 1% NSR payable to Tanqueray Resources Inc., which is buyable in its entirety at any time for C$3 million.