Benzinga | Jul 22, 2021 07:41AM EDT

EMX Executes Agreement To Sell Its Svrdsj Project In Sweden To District Metals

EMX Royalty Corporation (NYSE:EMX) (TSXV:EMX) (FSE: 6E9) (the "Company" or "EMX") is pleased to announce the the execution of an agreement for the sale of its Sv?rdsj? polymetallic project (the "Project") in Sweden to District Metals Corp. (TSXV:DMX) ("District"). The agreement provides the Company with additional share equity in DMX that brings EMX's ownership of District to 9.9%, annual advance royalty payments, a 2.5% Net Smelter Returns ("NSR") royalty interest in the Project, and other consideration.

The Sv?rdsj? Project is located in the prolific Bergslagen mining region of southern Sweden, nearby District's Tomtebo and Trollberget polymetallic VMS projects, which are also EMX royalty properties (see Figure 1). The Sv?rdsj? Project hosts multiple zones of polymetallic (copper-zinc-lead-silver-gold) volcanogenic massive sulfide ("VMS") and carbonate replacement ("CRD") style mineralization and is located in the vicinity of the historic Falun VMS mine and Boliden AB's active Garpenberg mine, one of the largest and most efficient underground polymetallic mines in the world.

Sv?rdsj? has been the site of historical mining activity for over 500 years, with production continuing through to 1989. Most recently, Boliden AB explored and drilled extensively in the area from 2009 until 2019. Historical production records indicate that much of the production came prior to 1972 and focussed on silver rich copper-zinc-lead mineralization developed as zones of replacement in carbonate host rocks. These styles of mineralization are similar to that seen in the nearby Garpenberg mine. See www.EMXroyalty.com for further information on the Project.

The agreement with District represents another example of EMX's execution of the royalty generation aspect of its business model. Although not available when first recognized during regional assessments, Sv?rdsj? remained on an EMX "watch list" for several years until coming available in 2020, when EMX quickly moved to secure the opportunity. EMX looks forward to working closely with District to further advance the Project.

Commercial Terms Overview. In accordance with the agreement, District will acquire a 100% interest in the Project subject to the following terms (all dollar amounts in CAD):

* Upon closing, EMX will transfer the Sv?rdsj? exploration license to District.

* Upon closing, EMX will receive $35,000 in cash and 1,400,000 common shares of DMX that increases EMX's equity ownership in DMX to 9.9% (on a non-diluted basis).

* EMX will receive a 2.5% NSR royalty interest in the Project. On or before the sixth anniversary after closing, DMX has the option to purchase 0.5% of the NSR on the Project by paying EMX $2,000,000.

* EMX will receive annual advance royalty ("AAR") payments of $25,000 for the Project commencing on the third anniversary of the closing, with the AAR payment increasing by $10,000 per year until reaching $75,000.

* Payments of $275,000, payable in cash or shares of DMX, will be made to EMX upon the achievement of certain milestones, and District will be responsible for fulfilling work commitments on the Project.

* To maintain its interest in the Project, within five years of the closing of the transaction, DMX will also: (i) spend a minimum of $1,000,000 on Project work expenditures with a minimum of $150,000 spent each year, and (ii) complete a minimum of 3,500 m of drilling.

* Closing is subject to approval by the TSX Venture Exchange.

Overview of the Sv?rdsj? Project. The Project comprises 1,037 hectares within the prolific Bergslagen mining region in southern Sweden. In the Project area, copper-zinc-lead-silver-gold VMS and carbonate replacement style mineralization are associated with mid-Proterozoic age volcanic belts (refer to Figure 1). The Project is situated within a three-hour drive of Stockholm-Arlanda airport and has excellent year-round access, as well as nearby rail and power lines.

Mineralization at Sv?rdsj? is primarily developed as polymetallic sulfide replacements in dolomitic carbonate units accompanied by skarn minerals. Bodies of mineralization are enveloped within broader alteration zones typical of VMS systems, which in the case of Sv?rdsj?, provide well documented vectors that can be used to guide further exploration.

Historical production primarily came from three mining areas, which includes Kompanimalmen ("Company Ore"), Mellangruvan ("Middle Mine"), and Norramalmen ("Northern Ore"), with several of the historical zones remaining open and poorly explored at depth. Most recently, exploration between 2009-2019 delineated new lenses of mineralization to the west and southwest of the historical mining areas1. These, and other underexplored areas of the project will be targets for further exploration.

In addition, several additional exploration targets exist on the project, either defined by untested geophysical anomalies, or based upon trends of historical prospects and occurrences.

Notes on nearby mines and deposits. The nearby mines and deposits discussed in this news release provide context for EMX's Project, which occurs in a similar geologic setting, but this is not necessarily indicative that the Project hosts similar mineralization.

Dr. Eric P. Jensen, CPG, a Qualified Person as defined by National Instrument 43-101 and employee of the Company, has reviewed, verified and approved the disclosure of the technical information contained in this news release.