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TICKERS: ELY; ELYGF; I4U

Royalty Company to Acquire 1% NSR Royalty in Ontario
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Ely Gold Royalties' new royalty will be on 46 mining claims surrounding the Coté gold project.

In a news release, Ely Gold Royalties Inc. (ELY:TSX.V; ELYGF:OTCQX; I4U:FSE) announced it agreed to purchase a 1% net smelter returns royalty on 46 mining claims in Ontario from Sanatana Resources for total consideration of $3 million.

The claims, also known as the Watershed property, are located in Ontario's Yeo and Chester counties and surround the Coté gold deposit. Some of the claims were included in a feasibility study done in 2018. The Coté project is a joint venture between IAMGOLD and Sumitomo Metal Mining.

The total consideration Ely Gold will pay Sanatana for the Watershed royalty will consist of $2.5 million in cash and 1 million Ely Gold warrants. The warrants will be exercisable for five years at CA$1.31 apiece and will have a four-month holding period.

The completion of the sale is based on the following conditions: "(i) receipt by Sanatana of a waiver from IAMGOLD of its right of first refusal as provided in Watershed Royalty ("ROFR"); (ii) the negotiation of a definitive agreement; and (iii) applicable approval of the TSX Venture Exchange." There is a 90-day period of exclusivity.

Also in conjunction with this deal, Ely Gold will pay Sanatana $10,000 for assignment of the rights and interest in Sanatana's 2016 purchase agreement with IAMGOLD for the claims. The Nevada-based royalty firm also will buy $500,000 worth of Sanatana common shares at CA$0.30 per share through a Sanatana nonbrokered private placement.

Ely Gold noted that there are certain deferred payments: "$1,500,000 upon a production decision by IAMGOLD on the Watershed Property; and $1,500,000 upon the commencement of commercial production by IAMGOLD on the Watershed Property."

"In the event that IAMGOLD exercises the ROFR and either of the Deferred Payments are made to Ely Gold, it will pay 50% of any such Deferred Payments to Sanatana," the company reported.

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Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Ely Gold Royalties, a company mentioned in this article.




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