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Redtail Metals, Tiger Resources to include AMB's assets

Staff writer |
Redtail Metals and Northern Tiger Resources have agreed with Americas Bullion Royalty (AMB) to expand the terms of the Northern Tiger and Redtail merger to include the acquisition by Northern Tiger of AMB's Brewery Creek Project and a $2.25 million investment by AMB in the merged company.

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In addition, Northern Tiger has completed the previously announced acquisition of AMB's interest in the Grew Creek gold project located in Yukon, Canada and related drill and core data for $900,000. Northern Tiger will be the surviving entity upon completion of the Merger and will be renamed "Golden Predator Mining Corp.".

Northern Tiger will acquire the balance of AMB's Yukon mineral properties, including the Brewery Creek Project, and AMB's accumulated tax losses, for a purchase price equal to $5,250,000 and the grant by Northern Tiger to AMB of a royalty interest in each of its properties held at closing.

To facilitate the AMB Acquisition, AMB will complete a pre-closing reorganization, following which AMB will be a wholly-owned subsidiary of a new company , the common shares of which will continue to be listed on the TSX. On completion of the reorganization, AMB's sole assets will be the Yukon Assets and AMB's accumulated tax losses. Newco will then transfer all of the outstanding shares of AMB to Northern Tiger.

Northern Tiger will satisfy the purchase price in part by the issue to Newco, at closing, of such number of Northern Tiger shares having an aggregate value of $550,000 and a convertible promissory note in the principal amount of $4,700,000 bearing interest at 6% per annum and payable over a period of three years. The balance of the purchase price will be satisfied by the grant to Newco of a royalty interest in each of its properties held at the closing of the AMB Acquisition.

AMB has also agreed to invest an aggregate of $2,250,000 in Northern Tiger common shares in connection with the Merger, $450,000 of which will be made immediately available pursuant to a non-revolving credit line convertible into Northern Tiger shares at closing.

This Interim Loan replaces the $150,000 bridge loan announced in Northern Tiger's and Redtail's October 28, 2013 joint news release, and will be advanced in tranches of $50,000 based on the working capital needs of Northern Tiger through to closing. AMB has also advanced $32,500 to Redtail for transaction related expenses. Both loans bear interest at 6% per annum (compounded annually) and are payable in Northern Tiger common shares at completion of the Merger at a price equal to $0.21 per share.

Concurrent with the completion of the Merger, Newco will subscribe, on a private placement basis, for Northern Tiger shares having a value equal to $2,250,000 less the amount then drawn under the Interim Loan. The Northern Tiger shares sold to Newco in the Concurrent Financing will be issued at a price per share equal to the greater of the VWAP of the Northern Tiger shares on the TSXV for the seven trading days immediately preceding the date of the NTR Meeting; and $0.28.

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