One was its acquisition of the Tonopah Extension Claims from Cliff ZZ. This asset consists of 73 patented mining claims in Esmeralda and Nye counties in Nevada. The claims are contiguous to Nevada Select's Tonopah West Property holdings, which now encompass 96 patented and 17 unpatented mining claims.
Concurrent with Nevada Select's acquisition of the Tonopah Extension Claims, the company sold the consolidated Tonopah West land package to Blackrock Gold under a four-year option agreement. Its closing was contingent on the deal with Cliff ZZ.
For Tonopah West, Blackrock paid $325,000 to Nevada Select on closing and also must pay $325,000, $650,000, $700,000 and $1 million on the first, second, third and fourth anniversaries of the closing, respectively.
Once Blackrock makes the final payment, Nevada Select will retain a 3% net smelter returns royalty on the property, with no buydown. When the option is exercised, Blackrock will pay Nevada Select an annual advance minimum royalty payment of $50,000.
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