Lode Gold Resources Inc. (TSXV: LOD; OTCQB: SBMIF) is pleased to announce the signing of a non-binding Letter of Intent (LOI) on September 23, 2024. This LOI outlines the acquisition of Great Republic Mining (GRM) by Lode Gold’s wholly-owned subsidiary, Gold Orogen (1475039 B.C. Ltd.). The transaction, structured as a Reverse Take Over (RTO), is intended to create a tax-efficient spin-out, resulting in two independent companies focused on maximizing shareholder value. Under the proposed arrangement, upon closing, Lode Gold shareholders are projected to hold approximately 74.16% of the outstanding shares in Gold Orogen, while Fancamp Exploration Ltd. and incumbent GRM shareholders would possess 19.9% and 5.94%, respectively. The CEO of Lode Gold, Wendy T. Chan, emphasized the importance of this strategic move, stating, “This Spin-out will unlock value for shareholders, creating two pure play companies to attract new investors.” The RTO will proceed based on a court-approved plan of arrangement as stipulated by the laws of British Columbia. Key operational plans include a meeting of shareholders to garner necessary approvals, while GRM intends to seek consent resolutions to facilitate the transaction. Additional terms involved the consolidation of GRM shares and specific conditions for closing that include maintaining a minimum cash balance and the absence of adverse legal or economic changes affecting either company. This corporate maneuver not only diverges Lode Gold’s business focus but also aims to bolster investor confidence by presenting distinct investment opportunities in the exploration sector, particularly in the highly prospective regions of Yukon and New Brunswick. Gold Orogen is backed by a $3 million funding effort, with plans to raise an additional $1.5 million to enhance its exploration activities. With the proposed transaction expected to close in the fourth quarter of 2024, both companies anticipate a mutually beneficial partnership. The upcoming months will involve meticulous planning and compliance with regulatory bodies, including the TSX Venture Exchange and Canadian Securities Exchange requirements. In summary, this strategic spin-out marks a significant milestone for Lode Gold Resources Inc. and presents an exciting future for its stakeholders as they work towards establishing two distinct explosion-focused entities.
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