Sanatana Responds to Trelawney Easement Application on Watershed Property
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 04/29/13 -- Sanatana
Resources Inc. ("Sanatana" or the "Company") (TSX VENTURE:STA)
provides an update to its shareholders with respect to the Watershed
Property. Set out below is a summary of (i) recent developments with
respect to the Watershed Property and (ii) a historical review of the
binding agreement governing the Watershed Property.
Peter Miles, President and Chief Executive Officer of Sanatana,
stated, "On Friday, April 26, 2013, Trelawney Mining and Exploration
Inc. (a subsidiary of IAMGOLD Corporation) filed an application with
the Ontario Mining and Lands Commissioner in connection with proposed
easements on the Watershed Property. The Commissioner made an order
for Trelawney and Sanatana to file materials in support of their
positions by June 3, 2013 and July 3, 2013, respectively. We object
to the proposed easements based on a number of grounds and we look
forward to the opportunity to make our position known to the
Commissioner. A copy of the "Order to File" materials with the
Commissioner will be posted on our website at
www.sanatanaresources.com." Mr. Miles further stated, "Sanatana has a
contractual right with Trelawney Augen Acquisition Corp. (also a
subsidiary of IAMGOLD) to acquire up to a 51% undivided interest in
the Watershed Property free and clear of all encumbrances -
including, for example, easements. We will defend the rights that we
are contractually entitled to."
Recent Developments with Respect to the Watershed Property
On Friday, April 26, 2013, Trelawney Mining and Exploration Inc.
("Trelawney"), a subsidiary of IAMGOLD Corporation ("IAMGOLD"), filed
an application with the Ontario Mining and Lands Commissioner (the
"Commissioner") with respect to proposed easement rights on the
Watershed Property. The Commissioner subsequently made an order for
Trelawney and Sanatana to file materials in support of their
positions by June 3, 2013 and July 3, 2013, respectively (together,
the "Order to File"). As a result of the Order to File, the
Provincial Recording Office, Ministry of Northern Development and
Mines, has or will note "Pending Proceedings" on the abstracts of the
subject mineral claims, being P-3004844, 3010239, 3014374, 3017665 to
3017668, both inclusive, 3018411, 3018437, 3019033, 4203839, 4203852,
4203294, 4209355, 4227171, 4240907 and 4240908.
Sanatana objects to the proposed easements on a number of grounds and
the Company looks forward to the opportunity to make its position
known to the Commissioner.
Summary of the Option and Joint Venture Agreement - Watershed
Sanatana entered into an option and joint venture agreement on the
Watershed Property with Augen Gold Corp. ("Augen") (as it then was)
effective February 14, 2011 (the "Option and JV Agreement"). Augen
was subsequently acquired by Trelawney and, through a corporate
reorganization, Augen was renamed "Trelawney Augen Acquisition Corp."
("TAAC"). Trelawney was then subsequently acquired by IAMGOLD.
The Option and JV Agreement was originally announced on February 16,
2011 and was accepted for filing by the TSX Venture Exchange on March
23, 2011. Copies of the news releases issued by Sanatana and Augen
(as it then was) are available on SEDAR at www.sedar.com under
Sanatana's SEDAR profile and TAAC's SEDAR profile, respectively. A
redacted copy of the Option and JV Agreement was also posted to
Sanatana's SEDAR profile on May 8, 2012 and can be accessed at
www.sedar.com. Readers are encouraged to access and review a copy of
the Option and JV Agreement.
50% Interest and ROFR Claims
Under the terms of the Option and JV Agreement, Sanatana has the
option to acquire up to a 51% undivided interest in the rights to 46
mineral concessions in Ontario (the "Property"), free and clear of
all encumbrances. The Property is located within the townships of
Yeo, Chester, Neveille and Benneweis and totals approximately 19,006
In November 2012, Sanatana exercised its first option and acquired a
50% undivided interest in the Property (the "50% Interest"). In order
to exercise the 50% Interest, Sanatana paid to TAAC $150,000 in cash,
issued an aggregate of 5,000,000 common shares and incurred over
$5,000,000 in work costs.
Pursuant to the terms of the Option and JV Agreement, in addition to
the option to acquire up to a 51% interest in the Property, Sanatana
has the right of first refusal to acquire, on or before March 23,
2014, nine additional mineral claims from TAAC (the "ROFR Claims").
The ROFR Claims are located in the Township of Chester and comprise
approximately 736 acres. A map of the Property, the ROFR Claims and
certain mineral tenure held by IAMGOLD is included at the end of this
Pursuant to the terms of the Option and JV Agreement, Sanatana is the
registered owner of the Property, which is to be held in trust for
the benefit of the parties in accordance with their respective
Additional 1% Interest and Joint Venture
Pursuant to the terms of the Option and JV Agreement, Sanatana has
the right to earn a further 1% interest in the Property, for a total
undivided interest of 51% (the "51% Interest"), free and clear of all
encumbrances. In order to earn the 51% Interest, Sanatana must
prepare and deliver to TAAC (at Sanatana's sole cost) a
pre-feasibility study on or before March 23, 2016. Sanatana is
considering its options in this regard and has until March 23, 2016
to decide whether to exercise its right to acquire the 51% Interest.
If Sanatana exercises its right to acquire the 51% Interest, the
parties would on the date of such exercise form a joint venture (the
"Joint Venture") to further explore the Property on the terms
described below. Alternatively, if Sanatana surrenders its right to
acquire the 51% Interest, the parties would form the Joint Venture on
the date Sanatana surrendered its right to acquire the 51% Interest
and in any event no later than March 23, 2016.
Under the terms of the Option and JV Agreement, Sanatana has the
right to be the manager of the Joint Venture (the "Manager") when it
is formed and will manage the work program(s) as directed by a
management committee set up based on the parties' respective
interests in the Joint Venture (the "Management Committee").
Ultimately, if Sanatana acquires the 51% Interest (and assuming that
it does not dilute its interest in the Joint Venture), Sanatana will
control the Management Committee and thereby control the instructions
the Management Committee gives to the Manager to establish programs.
Prior to the formation of the Joint Venture which could, at
Sanatana's election, be as late as March 23, 2016, Sanatana has
elected to continue to spend work costs on the Property. Under the
terms of the Option and JV Agreement, Sanatana will continue to be
credited for such work costs. Specifically, any work costs made or
incurred by Sanatana in excess of the work costs required to earn its
interest in the Property will be credited to Sanatana's contribution
to the first work program after formation of the Joint Venture and
will not automatically dilute the participating interest of TAAC on
formation. In addition to the $5,000,000 in work costs that Sanatana
has spent to acquire the 50% Interest, Sanatana has to date expended
further work costs of approximately $3,000,000 on the Property.
Area of Interest
The Property is protected by an area of interest extending at least
one kilometre from any portion of the Property (the "AOI") as it
existed as of the date of the Option and JV Agreement. If a party to
the Option and JV Agreement (or its affiliate) acquires any interest
in mineral claims or any other form of mineral tenure located wholly
or partly in the AOI (the "AOI Tenure"), then such acquiring party
must immediately notify the other party and provide the other party
with (i) details of the acquisition/staking costs associated
therewith and (ii) all details in its possession with respect to the
nature of the AOI Tenure and the known mineralization thereon. As
noted above, the AOI is at least one kilometre but the exact size of
the AOI was redacted in the copy of the Option and JV Agreement
Sanatana filed on SEDAR.
Pursuant to the Option and JV Agreement, TAAC has the right to
purchase up to 10% of any securities issued by Sanatana in a brokered
or non-brokered private placement, provided that TAAC qualifies under
an exemption provided by National Instrument 45-106 - Prospectus and
Registration Exemptions (the "Participation Right"). The
Participation Right will terminate immediately upon the termination
of the Option and JV Agreement or the formation of the Joint Venture.
TAAC is prohibited from exercising the Participation Right if it (or
any person or company acting jointly or in concert with TAAC) would
in the aggregate beneficially own, or exercise control or direction
over, 20% or more of the total issued and outstanding voting
securities of Sanatana, immediately after giving effect to such
Map of the Property, the ROFR Claims and Certain of IAMGOLD's
A map of the Property, the ROFR Claims, and certain of IAMGOLD's
properties is set out below. The map has a scale in kilometres and a
reader can see the scope of the AOI by drawing a one kilometre circle
from any point of the Property. As noted above, the AOI is at least
To view the Map associated with this release, please visit the
following link: http://media3.marketwire.com/docs/sta429-F1.pdf.
About the Company
Sanatana Resources Inc. is a Canadian mineral exploration and
development company focused on its Watershed Property in Ontario.
Sanatana entered into an option and joint venture agreement with
Trelawney Augen Acquisition Corp. (formerly Augen Gold Corp.)
("TAAC") which grants Sanatana an option to acquire up to 51% of the
Watershed property. On June 21, 2012, IAMGOLD Corporation completed
its acquisition of Trelawney Mining and Exploration Inc. and became
the sole indirect shareholder of TAAC. With an experienced management
team and board of directors, the Company has the ability required to
identify, develop and fund economic mineral properties. Sanatana is
based in Vancouver and is listed on the TSX Venture Exchange (TSX
The technical portions of this news release were reviewed and
approved by Troy Gill, BSc. MAIG, Exploration Manager for the
Company, a "qualified person" as defined by National Instrument
43-101 - Standards of Disclosure for Mineral Projects.
SANATANA RESOURCES INC.
Peter Miles, President and Chief Executive Officer
Cautionary Statement Regarding "Forward-Looking" Information
Some of the statements contained in this press release are
forward-looking statements and information within the meaning of
applicable securities laws. Forward-looking statements and
information can be identified by the use of words such as "plans",
"expects", "intends", "is expected", "potential", "suggests" or
variations of such words or phrases, or statements that certain
actions, events or results "may", "could", "should", "would", "might"
or "will" be taken, occur or be achieved. Forward-looking statements
and information are not historical facts and are subject to a number
of risks and uncertainties beyond Sanatana's control. Actual results
and developments are likely to differ, and may differ materially,
from those expressed or implied by the forward-looking statements
contained in this news release. Accordingly, readers should not place
undue reliance on forward-looking statements. The Company undertakes
no obligation to update publicly or otherwise revise any
forward-looking statements, except as may be required by law.
Neither TSX Venture Exchange nor its Regulations Services Provider
(as that term is defined in policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
Sanatana Resources Inc.
Mr. Peter Miles
President and Chief Executive Officer
604-408-6680 or Toll Free: 1-877-881-6680
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