VANCOUVER, BC / ACCESSWIRE / December 9, 2019 / Amarc Resources Ltd. ("Amarc" or the "Company") (TSXV:AHR)(OTCQB:AXREF) announces that it has amended its option agreement with Gold Fields Toodoggone Exploration Corporation ("GFTEC") to purchase its 51% interest in the PINE property (the "Property") (see Amarc news release August 29, 2017). Amarc will now hold a 100% interest in the PINE mineral claims having completed the purchase of Cascadero Copper Corporation's 49% interest in the Property last year (see Amarc MD&A December 31, 2018). The PINE tenure forms an important part of the overall JOY Project, and has been a primary focus of exploration activities. It hosts both the Pine and Mex copper-gold deposits as outlined by historical estimates based on 58 and 19 drill holes, respectively.
Under the terms of the amendment Amarc will purchase outright GFTEC's 51% interest in the 323 km2 Property by issuing to GFTEC 5,000,000 common shares of the Company. The issuance of a further 2,000,000 common shares of the Company to GFTEC is only contingent on certain expenditures levels being attained in the future, however, there is no obligation to complete any additional work.
GFTEC will retain a 2.5% net profits interest royalty ("NPI") on mineral claims comprising about 96% of the Property and a 1% net smelter returns royalty ("NSR") on the balance of the claims. The NPI can be reduced to 1.25% at any time through the payment to GFTEC of $2.5 million in cash or shares. The NSR can be reduced to 0.50% through the payment to GFTEC of $2.5 million in cash or shares.
The JOY Project covers the northern extension of the prolific Kemess porphyry gold-copper district. Members of the Amarc team are credited with being the first to recognize the Kemess district's true potential, having discovered and developed the Kemess South deposit to feasibility when the company that held the Kemess project at that time was taken over for $170 million. Extensive airborne and ground exploration surveys completed by Amarc over the JOY Project, along with the compilation of thousands of geochemical and geophysical survey data points from previous operators, have delineated multiple, high potential, porphyry gold-copper deposit targets. Multiple drill holes are required for the initial testing of each target area. Amarc is considering partnering the JOY Project.
The amendment to the GFTEC option agreement is subject to TSX Venture Exchange approval.
In addition, in November 2019 the Company entered into a purchase agreement with two prospectors to acquire 100% of a single mineral claim, located internal to the JOY tenure, for a direct acquisition cost of $5,000. The claim is subject to a 1% NSR royalty that is capped at $0.5 million payable from commercial production.
In other news, the Company announces that it has now resolved a repayment default under an existing $1 million loan made in 2014 by entering into a Loan Agreement, dated December 4, 2019 (the "Loan") with the lender who is a director and significant shareholder of the Company (the "Lender"). The Loan is unsecured, will bear interest at a rate of 10% per annum and is repayable after five years or earlier on the occurrence of a default or on achievement of financing milestones. In connection with the Loan, Amarc will issue to the Lender a loan bonus in the form of 16 million warrants (the "Bonus Warrants"), each entitling the holder to acquire one common share of Amarc for five years at a price of $0.05 per share. The Bonus Warrants will be subject to a four month hold period commencing from the date of issuance thereof. The Loan and Bonus Warrants are subject to acceptance by the TSX Venture Exchange.
About Amarc Resources Ltd.