DISCOVERY HARBOUR PROVIDES UPDATE ON CALDERA PROJECT AND JERSEY VALLEY PROJECT
Discovery Harbour Resources Corp. has provided the following update on its agreements relating to the Caldera project and to the Jersey Valley project, further to its news releases dated April 4, 2017, Feb. 27, 2017, and Nov. 23, 2016.
The Caldera Project is an epithermal gold project located in Nevada, approximately 37 km from the Kinross Round Mountain Gold Mine (the "Caldera Project"). Pursuant to an Exploration License and Option to Purchase Agreement dated November 18, 2016 as amended February 17, 2017 and March 30, 2017 (collectively, the "Caldera Agreements") between the Company and Genesis Gold Corporation ("Genesis Gold"), the Company was granted a license to explore the Caldera Project and an option to acquire the same on the terms and conditions of the Caldera Agreements. Under the Caldera Agreements, the Company will receive title to the Caldera Project upon the payment by the Company to Genesis Gold of the aggregate sum of US$400,000 in advance royalty payments which are payable as follows: US$5,000 on entry into the initial Caldera Agreement (paid), US$15,000 payable on June 30, 2017, US$30,000 payable on November 18, 2017, US$50,000 payable on November 18, 2018, US$75,000 payable on November 18, 2019, US$100,000 payable on November 18, 2020 and US$125,000 payable on November 18, 2021. Genesis Gold has retained a 2% net smelter return royalty with respect to the Caldera Project. The Company will also pay rentals for the unpatented mining claims to keep the property in good standing during the term of the Caldera Agreements. The Company also issued 500,000 common share purchase warrants (collectively, the "Caldera Warrants") to Genesis Gold on June 12, 2017 pursuant to the terms of the Caldera Agreements, which Caldera Warrants are each exercisable into one common share in the capital of the Company at an exercise price of CAD$0.05 per share until June 12, 2020. The Caldera Warrants are the shares issuable upon exercise thereof are subject to a hold period expiring on October 13, 2017.
The Jersey Valley Project is an epithermal gold project located in Nevada, approximately 45km southwest of the Phoenix Deposit (Newmont Mining) and approximately 29km southwest of the Cove-McCoy Deposits (Premier Gold Mines) in the Battle Mountain mining district (the "Jersey Valley Project"). Pursuant to an Exploration License and Option to Purchase Agreement dated November 18, 2016 as amended February 17, 2017 (collectively, the "Jersey Valley Agreements") between the Company and Genesis Gold, the Company was granted a license to explore the Jersey Valley Project and an option to acquire the same on the terms and conditions of the Jersey Valley Agreements. However, as disclosed in the Company's news release dated April 3, 2017, the Company has decided to terminate the Jersey Valley Agreements so that it can focus its resources on the Caldera Project. Prior to termination, US$5,000 was paid to Genesis Gold on signing of the initial Jersey Valley Agreement. On termination, the Company's obligation to issue 100,000 common share purchase warrants (collectively, the "Jersey Valley Warrants") to Genesis Gold remained outstanding; all other payment obligations were terminated. On June 12, 2017, the Company issued the Jersey Valley Warrants to Genesis Gold, each of which is exercisable into one common share in the capital of the Company at an exercise price of CAD$0.075 per share until June 12, 2020. The Jersey Valley Warrants and the shares issuable upon exercise thereof are subject to a hold period expiring on October 13, 2017.
