(TheNewswire)
Vancouver, British Columbia – TheNewswire - July 5, 2022 – RedLake Gold Inc. (CSE:RGLD)(“ Red Lake Gold ” or the “ Corporation ”)reports that it has been named as a party in a Statement of Claimissued by Barrick Gold Inc. (“Barrick Gold”) in the TorontoSuperior Court of Justice on June 30, 2022 (Court File No:CV-22-00683409-0000)(the “Claim”).
The Claim alleges, among other things, that Red LakeGold has breached certain obligations in Earn-In and Joint VentureAgreement to pursue more lucrative commercial arrangements concerningthe Corporation’s mining claims.
Red Lake Gold intends to defend the Claim and LencznerSlaght LLP has been retained by the Corporation as litigationcounsel.
Statement of Claim
The Claim seeks, on a joint and several basis, theaggregate sum of specified and enumerated monetary damages, amongother claims, of $120 million for a 70% exploration earn-in option(the “Earn-In Option”) in the Whirlwind Jack Gold Project(“Whirlwind Jack”), arising from the termination of the Earn-InOption by the Corporation on June 7, 2022.
Among other defendants to the Claim, Barrick Gold named“ABC Corporation Inc.”, as placeholder for party that Barrick Goldalleges may have attempted, or may attempt hereafter, to deal in thesubject project following the termination.
Information for Shareholders
Red Lake Gold advises shareholders as to the followingparticulars:
During the fall of 2021, Red Lake Gold elected toengage with Barrick Gold for purposes of examining anexploration-focused earn-in agreement whereby Barrick Gold might earnan interest in a portion of Whirlwind Jack (the “BarrickEngagement”).
The Barrick Engagement culminated in the formalizationof an exploration-focused earn-in option agreement which could, if allterms were met, enable Barrick Gold to earn a 70% interest inWhirlwind Jack (the “Exploration Earn-In Option Agreement”) asdated November 1, 2021, and as consequently disclosed with detail byRed Lake Gold (see news release, Red Lake Gold Inc. AnnouncesAgreement with Barrick Gold, dated November 3, 2021).
On June 3, 2022, Barrick Gold served Red Lake Gold witha force majeure declaration citing, among primary factors, communityengagement work and title-assertions (the “Barrick Gold Force Majeure Demand”). The Barrick Gold Force Majeure Demand also instructed Red LakeGold to act to mitigate damages expected to be suffered by Red LakeGold by way of claim loss at Whirlwind Jack because of an assessmentcredit deficit due to a corresponding exploration work deficit on thepart of Barrick Gold. Barrick Gold alleged that Red Lake Gold had anobligation to maintain the claims for Barrick Gold based on apurported good-faith demand that, according to Barrick Gold, Red LakeGold owed to Barrick Gold under the Exploration Earn-In OptionAgreement.
Between the dates of the Exploration Earn-In OptionAgreement and the Barrick Gold Force Majeure Demand, being an approximateseven-month period from November 1, 2021 to June 3, 2022, Barrick Goldindicated it performed approximately $30,538 in exploration work(through LiDAR survey) at Whirlwind Jack (the “Filed Barrick GoldExploration Work”) as the Filed Barrick Gold Exploration Work isrelative to annual government-prescribed assessment obligations forWhirlwind Jack of $416,800. The Filed Barrick Gold Exploration Workwas indicated to be applied to claims that matured in May 2022, andthe entirety of which remains pending approval by the Government ofOntario as of today.
On June 7, 2022, Red Lake Gold delivered a terminationnotice to Barrick Gold of the Exploration Earn-In Option Agreementfor, among other factors: (a) failure by Barrick Gold to meet force majeure threshold requirements; (b) failure by Barrick to performsufficient exploration work to keep the claims comprising WhirlwindJack in good-standing; (c) a rejection of the blanket assertions byBarrick Gold that additional aerial surveys would not qualify aseligible work expenditures; (d) a rejection of demands by Barrick Goldto Red Lake Gold that Red Lake Gold use assessment credits it holds atits corporate-level as a result of Red Lake Gold exploration work (the“Red Lake Gold Exploration Work”) for the benefit of Barrick Gold,(e) a rejection of the assertion by Barrick Gold that Red Lake Goldhad a contractual obligation to maintain the claims for Barrick Gold,and (f) as to the demand by Barrick Gold that Red Lake Goldimmediately act to mitigate damages expected to be suffered by RedLake Gold due to imminent claim loss at Whirlwind Jack.
On June 8, 2022, Red Lake Gold announced that it haddelivered the Red Lake Gold Termination. In light of the Claim, RedLake Gold today reports that the identity of the unnamed party in itsnews release of June 8, 2022 was Barrick Gold (see news release, RedLake Gold Inc. Delivers Termination Notice to Earn-In Party Re:Whirlwind Jack Project, dated June 8, 2022).
Red Lake Gold believes that its shareholders are therightful beneficiaries of assessment credits owned by Red Lake Gold(the “RGLD Exploration Credits”), including those held by theCorporation from the Red Lake Gold Exploration Work or otherwise, andthat Barrick Gold has no contractual entitlement to demand possessionor use of the RGLD Exploration Credits.
As the registered owner of the mining claims thatconstitute Whirlwind Jack, Red Lake Gold intends to apply RGLDExploration Credits to protect its claims and satisfygovernment-imposed obligations relating toassessment credit expenditure duties imposed on claim owners inOntario, and as further applicable to mining claims within WhirlwindJack that have an upcoming anniversary date of July 10 th .
The Corporation maintains that Barrick Gold has failedto meet contractual requirements under the Earn-In Option Agreementand moreover Red Lake Gold maintains that no joint-venture exists asbetween the parties.
All monetary amounts in this news release are expressedin Canadian dollars.
OnBehalf of the Board of Directors
Ryan Kalt
Chairman & Chief Executive Officer
Red Lake Gold Inc.
Forward-Looking Statements
This news release contains"forward-looking information" concerning anticipateddevelopments and events that may occur in the future. Forward lookinginformation contained in this news release includes, but is notlimited to, statements with respect to the statement that Red LakeGold intends to defend the allegations made in the Claim, the outcomeof the Claim and Red Lake Gold’s operations.
In certain cases, forward-lookinginformation can be identified by the use of words such as"plans", "expects" or "does not expect","budget", "scheduled", "estimates","forecasts", "intends", "anticipates" or"does not anticipate", or "believes", orvariations of such words and phrases or state that certain actions,events or results "may", "could","would", "might", "occur" or "beachieved" suggesting future outcomes, or other expectations,beliefs, plans, objectives, assumptions, intentions or statementsabout future events or performance. Forward-looking informationcontained in this news release is based on certain factors andassumptions regarding, among other things, that Red Lake Gold will successfully defend theClaim or in alternative reachan agreement that otherwise achieves settlement of theClaim , and while Red Lake Gold considers these assumptions to be reasonablebased on information currently available to it, that may prove to be incorrect.
Forward looking information involvesknown and unknown risks, uncertainties and other factors which maycause the actual results, performance or achievements of Red Lake Goldto be materially different from any future results, performance orachievements expressed or implied by the forward-looking information.Such factors include the outcome of the Claim and the risks identifiedin the "Risk Factors" sections of Red Lake Gold’s publiclyfiled reports and filings with applicable Canadian securitiesregulators.
Although Red Lake Gold has attemptedto identify important factors that could cause actual actions, eventsor results to differ materially from those described inforward-looking information, there may be other factors that causeactions, events or results not to be as anticipated, estimated or intended.Accordingly, readers should not place undue reliance onforward-looking information. The forward-looking information is madeas of the date of this news release. Except as required by applicablesecurities laws, Red Lake Gold does not undertake any obligation topublicly update or revise any forward-looking information.
Neither the CSEnor its Regulation Services Provider (as that term is defined in thepolicies of the CSE Exchange) accepts responsibility for the adequacyor accuracy of this release.
Ryan Kalt
Chief Executive Officer
Red Lake Gold Inc.
Telephone: 604-687-2038
Email: info@redlakegold.ca
Website: www.redlakegold.ca
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