Bayridge Resources signs LOIs for Waterbury East, Constellation projects, Saskatchewan

Bayridge Resources Corp. [TSXV-BYRG] has entered into letters of intent (LOI) with CanAlaska Uranium Ltd. [TSXV-CVV; OTCQX-CVVUF; FSE-DH7] to allow the company to earn up to an 80% interest in each of Canalaska’s Waterbury East and Constellation projects in the Athabasca basin in Saskatchewan.

Under the terms of the LOIs, Bayridge may earn up to an 80% interest in each of the projects by undertaking work and making cash and share payments in three defined earn-in stages: an initial 40% interest (stage 1), an additional 20% interest for a total 60% interest (stage 2) and an additional 20% interest for a total 80% interest (stage 3).

The LOI contemplates the following work and payment obligations for each earn-in stage:

Waterbury East project: Stage 1 (40% interest) – pay $265,000 cash, issue $370,000 of common shares of Bayridge and incur $1.5-million in exploration expenditures within 18 months of the date of the definitive agreement (the Waterbury East agreement date).

Stage 2 (60% interest) – pay a further $220,000 cash, issue an additional $385,000 of common shares and incur a further $1.5-million in exploration expenditures within 12 months of commencing the stage 2 earn-in (approximately 2.5 years after the Waterbury East agreement date).

Stage 3 (80% interest) – pay a further $275,000 cash, issue an additional $550,000 of common shares and incur an additional $2-million in exploration expenditures within 12 months of commencing the stage 3 earn-in (approximately 3.5 years after the Waterbury East agreement date).

Constellation project: Stage 1 (40% interest) – pay $225,000 cash, issue $315,000 of common shares of Bayridge and incur $1.5-million in exploration expenditures within 18 months of the date of the definitive agreement (the Constellation agreement date).

Stage 2 (60% interest) – pay a further $165,000 cash, issue an additional $290,000 of common shares and incur a further $1.5-million in exploration expenditures within 12 months of commencing the stage 2 earn-in (approximately 2.5 years after the Constellation agreement date).

Stage 3 (80% interest) – pay a further $210,000 cash, issue an additional $415,000 of common shares and incur an additional $2-million in exploration expenditures within 12 months of commencing the stage 3 earn-in (approximately 3.5 years after the Constellation agreement date).

With respect to each project, after successful completion of stage 1, if Bayridge elects to not enter the next stage or fails to make the stage 2 option payments when and as required; or stage 2, if Bayridge elects to not enter the next stage or fails to make the stage 3 option payments when and as required; or stage 3, a joint venture will be formed and the parties will either co-contribute thereafter on a simple pro rata basis or dilute on a predefined straight-line dilution formula. Any party diluting to a 10% interest will automatically forfeit its interest in the project and in lieu thereof will be granted a 2-per-cent net smelter return royalty on the project.

During all stages of both option agreements, Bayridge will be operator of the projects and will be entitled to charge an operator fee. Bayridge will have deciding voting rights on annual exploration programs while sole financing at the various option stages. An area of mutual interest will extend 2 km from the outer boundary of the projects, excluding all properties within such area that are currently held by CanAlaska at time of signing the definitive agreement.

Bayridge is currently conducting due diligence on the properties comprising the projects. Upon successful due diligence, the parties will work toward finalizing and executing a formal agreement. Completion of the transactions contemplated under the LOIs is subject to a number of standard conditions for transactions of this nature, including, among other things, the negotiation and execution of definitive option agreements and regulatory approval.

Bayridge CEO Charn Deol commented: “Bayridge is excited that the company was able to negotiate LOIs for two uranium exploration projects in the prolific Athabasca region of Canada, which is one of the world’s leading sources of high-grade uranium and currently supplies approximately 15% of the world’s uranium.”

The company would also like to provide an update on its Sharpe Lake property in Ontario. As described in the company’s final prospectus dated November 10, 2023, the company can acquire a 100% interest in the Sharpe Lake property, subject to a 3% net smelter royalty, by making certain cash and share payments and by completing certain exploration expenditures on the property.

To date, the company has engaged a contractor to carry out an airborne survey on the property and has paid a down payment in connection therewith. The issuer intends to carry out the airborne survey and the rest of the phase 1 exploration program in the spring or summer of 2024, once weather conditions permit.