Major General pays $12 million for Umex package

In return for 32 Canadian properties and associated assets, Major General Resources (VSE) will pay over $11.7 million to Umex, a unit of Union Miniere of Belgium, but only $250,000 will be in cash. Of the total sum, $11.25 million will come from production proceeds equal to a 2.5% net smelter return on each of the properties. The balance will be paid in cash plus a 2-year promissory note for $250,000 bearing interest at 10%. A finder’s fee of $25,000 is also payable.

Major General has agreed to spend $5 million on exploration on the properties over the next five years, and intends to fund the exploration through joint ventures, current working capital and future financings.

The Umex portfolio covers 85,000 acres of land across Canada, including several precious metal prospects in the Pickle Lake mining district of northwestern Ontario.