Vancouver, British Columbia / ACCESSWIRE / October 17, 2014 / Goldrush Resources Ltd. (TSX-V: GOD) ("Goldrush" or the "Company") is pleased to announce that it has completed the sale (the "Transaction") of its wholly-owned Burkina Faso subsidiary, Goldrush Burkina S.A.R.L. ("Goldrush Burkina") to Nord Prognoz Ltd., a wholly-owned subsidiary of Nord Gold N.V. (LSE: NORD) ("Nordgold"), pursuant to the terms of the Share Purchase Agreement dated June 11, 2014, as amended among the Company, Goldrush Burkina and Nordgold. Goldrush Burkina holds the Tikare and Kongoussi 1 mineral permits that comprise the Ronguen Project, which is located 10 kilometres northwest of Nordgold's Bissa gold mine and 100 kilometres north of Ouagadougou, the capital city of Burkina Faso.
Prior to the closing of the Transaction, all assets and liabilities of Goldrush Burkina, other than the Tikare and Kongoussi 1 permits (which host the Ronguen Project which continue to be held by Goldrush Burkina) were transferred from Goldrush Burkina to Goldrush West Africa S.A.R.L. ("Goldrush West Africa"), a new wholly-owned subsidiary of the Company. Accordingly, Goldrush, through Goldrush West Africa, continues to indirectly hold six mineral permits and one mineral permit application in Burkina Faso.
Goldrush received the following from Nordgold as consideration (the "Purchase Price") for the sale of Goldrush Burkina:
- a cash payment of US$4,250,000, of which US$1,000,000 is being held in escrow, to be released in two tranches on July 1, 2015 and December 31, 2017, subject to deductions for any liabilities of Goldrush Burkina that occurred prior to Closing;
- the grant of a 1% Net Smelter Returns Royalty on any production from the Ronguen Project at a gold price over US$1,700 per ounce. The royalty may be repurchased at anytime for a cash consideration of US$1,000,000; and
- an extinguishment of certain back-in rights held by Nordgold (or its predecessor, High River Gold Mines Ltd.) on Goldrush's Salbo or Ouavousse permits.
Goldrush currently intends to use the net proceeds from the sale of Goldrush Burkina to continue its precious metals exploration by advancing its land position in West Africa through the exploration of its mineral permits, for the acquisition of complimentary, geologically promising permits, and for corporate and general working capital purposes.
Commented Len Brownlie, President and CEO of Goldrush: "This was a very complex transaction to complete and we certainly appreciate the patience of our shareholders as we worked through many issues to a successful Closing. With a relatively full treasury, we now look forward to resuming our work in West African gold exploration. "
About Goldrush:
Goldrush is a Canadian mineral exploration company, focused on gold exploration in Burkina Faso, West Africa.
About Nordgold:
Nordgold (LSE: NORD) is an international pure-play emerging-markets gold producer established in 2007 and publicly traded on the London Stock Exchange. Nordgold has expanded rapidly through acquisitions and organic investment, achieving a rate of growth unmatched in the industry during that period. In 2013, Nordgold's gold production increased to 924,000 ounces from 717,000 ounces in 2012.
Nordgold operates nine mines in Russia, Kazakhstan, Burkina Faso and Guinea. Nordgold has two development projects, four advanced exploration projects and a diverse portfolio of early exploration projects and licenses in CIS, West Africa and French Guiana. Nordgold currently employs over 10,000 workers.
For further information on Nordgold please visit www.nordgold.com
For further information on Goldrush Resources Ltd., shareholders and other interested parties are invited to visit the Company's website at www.goldrushresources.ca.
ON BEHALF OF THE BOARD OF DIRECTORS,
GOLDRUSH RESOURCES LTD.
"Len Brownlie"
Len Brownlie - President and Chief Executive Officer
For Goldrush:
Len Brownlie, President and CEO: [email protected]
1-604-602-9973
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
FORWARD-LOOKING STATEMENTS: This news release contains certain "forward-looking statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. Except for statements of historical fact relating to the company, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur, and include, without limitation, statements regarding the share purchase agreement with Nordgold, how it intends to use the proceeds from the sale of Goldrush Burkina, the Company's plans with respect to future acquisitions, exploration and development. Forward-looking statements in this release including statements regarding the Transaction are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include uncertainties relating to the release of the funds held in escrow, the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future and other factors. The Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.
SOURCE: Goldrush Resources Ltd.