Ryan Gold Corporation

April 26, 2011 16:00 ET

Ryan Gold Signs Definitive Agreements to Acquire All Shawn Ryan's Gold Properties

TORONTO, ONTARIO--(Marketwire - April 26, 2011) - Ryan Gold Corp. (TSX VENTURE:RYG), "Ryan Gold" or the "Company") is pleased to announce that, as contemplated in its press release dated February 16, 2011, it has signed purchase, royalty and employment agreements (the "Agreements") with Shawn Ryan. Pursuant to the purchase agreement Ryan Gold will purchase 50 properties, comprising 6,558 Quartz Claims (the "Properties") located in the Yukon Territory, through the acquisition of Mr. Ryan's 70% interest in the Properties and the acquisition of all of the issued shares of 45127 Yukon Inc. ("Claimsco"), which owns the remaining 30% interest in the Properties. Mr. Ryan owns all of the shares of Claimsco.

The 6,558 Quartz Claims, covering 132,697 Ha, are grouped in 50 major project areas covering various prospective geological terrains throughout the Yukon Territory. The Properties represent all of Mr. Ryan's precious metal interests that have not been previously optioned to Ryan Gold, or other third party companies. The major features of the Agreements include:

  • cash consideration of $7.5 million payable in three instalments, $2.5 million on closing, $2.5 million on the first anniversary of closing and $2.5 million 60 days after the second anniversary of closing;

  • share consideration of 7.5 million common shares of Ryan Gold on closing;

  • a 1% net smelter return royalty on the Properties;

  • up to three (3) bonus payments of $750,000 each on any individual project area triggered when the cumulative exploration expenditure on the project area reaches: $7.5 million, $15 million and $25 million for a maximum amount per property area of $2.25 million. The bonus payments can be made in cash or common shares of Ryan Gold, or a combination of cash and common shares of Ryan Gold at Ryan Gold's discretion. Subject to receipt of requisite regulatory approval, including without limitation, the approval of the TSX Venture Exchange, the issue price per common share will be based on the five day volume weighted average closing price of the common shares of Ryan Gold calculated from the date that Ryan Gold elects to satisfy all or part of the bonus payment in common shares. In addition, the bonus payments and the royalty payments shall extend to any property whose primary mineral is gold up to a maximum of an additional 50 additional project areas which may be staked by Ryan Gold in the Yukon within the term of Mr. Ryan's employment agreement with Ryan Gold.

  • Mr. Ryan has also granted Ryan Gold a right of first offer on any properties in the Yukon that are currently subject to option to third parties, that expire unexercised. Ryan Gold has similarly granted Shawn Ryan a right of first offer on any properties in the Yukon that Ryan Gold shall seek to dispose of.

  • Mr. Ryan has also entered into an employment agreement with Ryan Gold having a term of five (5) years pursuant to which, at closing, Mr. Ryan will be appointed President of Ryan Gold. As part of his employment agreement, at closing Ryan Gold will grant Mr. Ryan options to purchase 500,000 common shares.

Completion of the transactions contemplated in the Agreements are subject to receipt of all necessary regulatory approval from the TSX Venture Exchange.

The Properties range from grass roots exploration targets, where ridge and spur soil geochemical sampling has identified exciting targets for more detailed follow-up exploration, to more advanced exploration targets where grid soil geochemical sampling, mapping, geophysical surveys and very limited drilling campaigns have been conducted. The more advanced projects include the Nug and Mahtin projects located in the Ross River and Mayo areas respectively.

Ryan Gold's CEO Michael Skead states, "Completion of the Agreements with Shawn Ryan positions Ryan Gold as one of the premier holders of exploration rights within the Yukon. We now look forward to advancing all our projects, initially focussing on assessment and drilling of the Ida Oro project. In addition, this summer the Company also plans to conduct an 85,000 soil sample program and to fly 24,500 line kilometres of airborne magnetic and radiometric survey to assess the new properties. The Board and Management look forward to welcoming Mr. Ryan as President and working with him as he continues highly successful prospecting of the Yukon."

Shawn Ryan commented, "This transaction represents a new and exciting path. Cathy and I have worked extremely hard over the past 15 years to find, manage and explore a large portfolio of gold projects. With Ryan Gold's experienced geological and management team, we will now be a part of a company of like-minded individuals that have the same goals, objectives and beliefs that the Yukon is one of the last under-explored regions in the world. The old saying "two heads are better than one" really applies to this situation."

Michael Skead (MAusIMM), CEO of Ryan Gold, has acted as the qualified person under NI 43-101 and reviewed the content of this press release.

This press release contains forward-looking statements within the meaning of applicable securities legislation. Such statements include, without limitation, statements regarding the future results of operations, performance and achievements of the Company, including potential property acquisitions, the timing, content, cost and results of proposed work programs, the discovery and delineation of mineral deposits/resources/reserves, geological interpretations, proposed production rates, potential mineral recovery processes and rates, business and financing plans and business trends. Although the Company believes that such statements are reasonable, it can give no assurances that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, significant downward variations in the market price of any mineral that may be produced, the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, to produce minerals from its properties successfully or profitability, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies. All of the Company's public disclosure filings may be accessed via www.sedar.comand readers are urged to review these materials, including any technical reports filed with respect to the Company's mineral properties. This press release is not, and is not to be construed as an offer to buy or sell securities in the United States.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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