Claim Post Resources Inc. has acquired title to and control over nine quarry leases from a number of third parties, including Char Crete Ltd., Simmons Construction Ltd. and O/S Investment Corp. for a total investment of $1.3 million. These leases are directly adjacent to Claim Post’s existing quarry leases, consolidating Claim Post’s strategic control over the Tier 1 Frac Sand deposit at Seymourville, Manitoba, Canada.
Upon Claim Post attaining commercial production of frac sand, Claim Post is entitled to recover its total investment plus interest at 9 percent, compounded annually before the production royalty commences. The terms of the production royalty remain unchanged from those contained in the previously disclosed arrangement with respect to these leases.
Claim Post has also provided notice to the holders of its outstanding convertible debentures that it has elected to repay the remaining approximately $2.7 million principal amount plus interest owing at maturity on June 21, 2018, by issuing to such holders an aggregate of approximately 55.4 million common shares of the company in accordance with the terms of the debentures.
After giving effect to this debenture repayment in common shares, the company will have a simplified capital structure, with approximately 187.6 million common shares and no debt outstanding. Over the past year, the funds raised from the issuance of these debentures have allowed Claim Post to better position itself for future growth by consolidating the sand leases at Seymourville, re-focusing Claim Post’s asset base by selling the Timmins mineral leases, stabilizing the balance sheet, and strengthening the leadership of the board of directors and management of Claim Post.
Claim Post’s Executive Chairman Lowell Jackson stated, “Claim Post is pleased to now hold complete and consolidated title to both the Seymourville and the adjoining Manigotagan properties, which provides us control over approximately two-thirds of the Seymourville Tier 1 sand resource of 600 million tonnes as determined by the Manitoba Government. Claim Post’s significant surface silica sand deposit remains in high demand for fracking in the energy industry and we can now move forward to pursuing an active development stage. Claim Post leadership will now turn its attention to financing the next stage of growth of this exciting project.”