Royal Road Minerals Limited (CVE:RYR) (OTCMKTS:RRDMF) (FRA:RLU) has completed the sale to Hemco Nicaragua SA of its 50% interest in the Luna Roja Project that comprises the Monte Carmelo I and Monte Carmelo II mining concessions in Nicaragua.
The project had previously been jointly owned and operated by the company and Hemco since 2017. Hemco is a subsidiary of Mineros SA.
Under the terms of the transaction, Royal Roads sold its 50% interest in the project on the following key terms:
- Royal Roads will get US$24,485,294 million, of which US$20,812,000 was paid in cash at closing. The remaining US$3,672,794 was retained by Hemco to be remitted to the applicable governmental authorities in accordance with withholding tax requirements under Nicaraguan law;
- Plus, there will be a 1.25% net smelter return royalty on all future mineral production from the Monte Carmelo I and Monte Carmelo II mining concessions; and
- Royal Roads will invest US$7.5 million over a five-year period for exploration programs and budgets approved by a joint Hemco/Royal Roads management committee pursuant to the Strategic Alliance Agreement struck in 2017.
Royal Roads said the Strategic Alliance Agreement, as amended, will continue in effect, including with respect to the jointly-owned Caribe Project and the company’s other joint projects with Hemco in Nicaragua.
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Story by ProactiveInvestors
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