EDM Resources Inc (TSX-V:EDM, OTC:SWNLF) has inked a deal to sell a portion of its anticipated annual silver production from the Scotia Mine.
A Letter of Intent (LOI) agreement with Silver Crown Royalties (SCRi) envisages the sale of approximately 7,000 ounces per year, covering the silver by-product from the Scotia mine’s zinc concentrate.
In effect, EDM will monetize the future silver production with a $1 million royalty.
EDM will receive a cash payment of C$500,000 plus C$500,000 worth of SCRi units, comprising one common share of SCRi and one-half of share warrant (with each whole warrant exercisable at C$16.00, over a 36 month period of 36.
The company has committed to delivering 90%, but no less than 7,000 ounces of silver annually, for a duration of ten years.
The transaction is expected to close within the next six weeks, pending due diligence and the execution of a definitive agreement.
Silver Crown Royalties, listed on the Cboe Canada stock exchange, is a revenue-generating silver-only royalty company focused on silver as by-product credits.