Guyana Frontier receives TSX-V Acceptance for Five Star Property Option and Joint Venture Agreement
VANCOUVER, May 12 /PRNewswire-FirstCall/ – Guyana Frontier Mining Corp. (“Guyana Frontier”) is pleased to announce it has received TSX Venture
Exchange (“TSX-V”) acceptance for a definitive option and joint venture
agreement (the “Agreement”) between Guyana Frontier and Mulgravian
Ventures Corporation (“Mulgravian”), a non-arm’s length private B.C.
company, pursuant to which Mulgravian can earn a 51% working interest
in the Five Star property (“Five Star”) located in northwestern Guyana,
Five Star consists of 14 mining permits and 11 prospecting permits,
which cover an area of approximately 25,065 acres (10,144 hectares)
near the settlement of Matthew’s Ridge, Guyana. Five Star is adjacent
to Guyana Frontier’s Whana and Black Banana properties, which forms a
contiguous area of approximately 115,580 acres (47,775 hectares).
Guyana Frontier acquired its 100% interest in Five Star from two
separate underlying vendors, Case Development Company Ltd. and Marcel
Andrew Waaldijk (collectively, the “Underlying Vendors”), with each
Underlying Vendor currently maintaining a 3% net smelter returns
royalty (“NSR”) on their respective permits. Each NSR is subject to
buy-down provisions. Further details on the acquisitions of Five Star
and the NSRs can be found in Guyana Frontier’s news releases dated
April 12, 2010, April 20, 2010, and April 21, 2011.
Pursuant to the terms of the Agreement, Guyana Frontier has granted
Mulgravian the option to earn a 51% working interest in Five Star by:
-- making aggregate exploration expenditures and certain property acquisition payments to the Underlying Vendors totalling US$2,000,000 over a four-year period from the date of TSX-V acceptance, being May 10, 2011; -- purchasing an aggregate of 700,000 units (the "Units") of Guyana Frontier by way of private placement (the "Private Placement") for gross proceeds of CDN$210,000; and -- exercising all of the common share purchase warrants (the "Warrants") comprising the Units for further gross proceeds to Guyana Frontier of CDN$420,000.
The Private Placement closed on December 10, 2009, with the first
tranche of Warrants being exercised on November 23, 2010 for proceeds
of CDN$210,000 to Guyana Frontier. Further details of the Private
Placement, the terms of the Units and the Warrants, and the exercise of
certain Warrants can be found in Guyana Frontier’s news releases of
November 4, 2009, January 8, 2010 and November 23, 2010. The Agreement
supersedes and replaces a letter of intent dated October 22, 2009,
between Guyana Frontier and Mulgravian.
On March 10, 2011, Mulgravian gave notice to Guyana Frontier that
pursuant to the terms of the Agreement, it wished to assume direct
operatorship of the Five Star property. Prior to such date, Mulgravian
had retained Guyana Frontier to manage and operate the exploration
programs on the Five Star property.
On May 10, 2011, Guyana Frontier filed a technical report on SEDAR,
compliant with the standards of National Instrument 43-101, in respect
of Five Star.
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.
SOURCE Guyana Frontier Mining Corp.