M&A Announcement

Oct 5, 2020

Good afternoon, ladies and gentlemen, and welcome to the conference call held by Enfysco Gold Royalties on the transaction announced today. After the presentation, we will conduct a question and answer session. Please note this call is being recorded today, October 5, 2020, at 5 pm Eastern Time. Today on the call, we have Mr. Sean Wilson, Chair of the Board of Directors and Chief Executive Officer of Assisted Gold Royalties and Mr. Sandeep Singh, President of Assisted Gold Royalties. I would now like to turn the call over to your host for today's call, Mr. Sean Wilson. Creating a premier North American gold mining company. Welcome, everybody, and gienvenue to the home, de propeles comprendons. We are using a PowerPoint presentation that you can find on our website titled Creating a Premier North American Gold Mining Company. We will be making some forward looking statements, so I'd like you to take a moment to look at the cautionary statement regarding our forward looking statements. We will be making some forward looking statements here. I'm just going to give a bit of a preamble before I ask Sandeep Singh, the President, and will be appointed CEO of Osisko Global Avi, and as I take the role of Executive Chairman, to give us a description of the power of the transaction as it stands. As a lot of shareholders that may be on this call know, we had acquired Barkerville Gold Mines in September of last year when the gold price was about USD13.20 per ounce. Subsequent to that, we've seen the gold price rise to over $1900 an ounce to over $2,500 an ounce. And we thought it was time to take advantage of the moment and to reintroduce this project to a Cisco Development Corporation as well as a new project that people will know less of called San Antonio, which we believe is a spectacular heap leach opportunity in Sonora, Mexico, about an hour and a half out of Hermosillo. This company will also take quite a few of the technical staff that we have working on Barkerville and other projects with us into this vehicle and set the stage for what we believe is a premier new mining company in the mid tier states with the Barkerville project being front and center of that evolution. And I'll get more into that as we get into it. The advantage for a Cisco Gold royalty will be the simplification of the royalty business back more towards the pure royalty model that shareholders have expressed an interest in pursuing. So hopefully, we've accomplished a lot in terms of expectations for the marketplace and also setting the stage for something quite spectacular as the Barker Rail project at San Antonio come together to create what I believe will be one of the best royalty opportunities of the last of this cycle with creating more than 20,000 GEOs once they're in production for our fiscal gold royalties. This company, Sysco Development, will be quite robust. I will be the acting CEO and Chairman Luc Lessard, Chief Operating Officer Chris Loeder, the President and driving the exploration. And we'll get more into the rest of the development team. And we're also joined his new role. Benoit Brunei will be joining us as the CFO of this new entity. We will be sharing office space with OR and continue to work hand in glove on the OR platform as we evolve what I believe is the most significant step that we've taken in the accelerator model that we engineered and pioneered since 2014. I'll ask Sandeep now to jump in and take us through some of the details of the transaction. So Sandeep, over to you. Yes. Thanks a lot, Sean, and thanks, everyone, for joining us. On short notice for what we feel is a fairly or extremely important and value locking announcement for the company and frankly a big step forward in what we've been conveying to shareholders all year. I'm on Slide 3 just really quickly because Sean has covered a lot of the key points Worth reemphasizing, there's a fair few pieces to this transaction. Overall, this is a simplification of the Cisco Global Loyalty Business Model and the culmination of the North Spirit transaction to be renamed Cisco Development Corp, which will be advancing the highly attractive sets of assets that Sean mentioned towards intermediate producer status. Essentially, what we've been saying all year with the twist that we're doing it publicly instead of privately, and we'll walk through certainly some of the reasons for that. I think it's fair to say that we've heard the views on some of the complexity that people have been seeing in our name and hope that this is viewed as a huge step forward towards that separation of church and state that's been asked of us and frankly, that we've been asking of ourselves since we acquired BGM in the fall. If you look forward to Slide 4 of the transaction, there is more summary terms here in detail. I won't go through them, but they're there to be reviewed at your pleasure. And again, at a high level, we are conducting the spin out to an RTO transaction with a company called Burrow Ventures Corp and spinning out those assets to Formosisco Development Corp. The portfolio will include, as I mentioned, the Caribou Camp as the flagship asset and the newly acquired San Antonio heap leach open pit in Mexico. And Sean will go through that in significant detail later on. But that adds, in our mind, quite a bit to the portfolio of assets here with near term cash flow for relatively little CapEx. A portion of the equity book within Assisco royalties will also be transferred with a current value of $116,000,000 That provides a buffer, if you will, a little bit to the balance sheet Cisco Development as well as significant optionality to some pretty interesting gold projects. There are other early stage exploration assets that make more sense, frankly, in the Cisco development portfolio than they do in Cisco royalties, both in James Bay and Mexico. Again, those are promising regions that won't get immediate attention necessarily, but are available and really only one drill hole away from something interesting. Sean, as you mentioned, will take on the CEO role, but we'll have a full complement of technical people move across. And frankly, the mine building team that we have within the Cisco royalties will be able to be leveraged to their fullest within the Cisco development. Concurrent with the spin out, fiscal development is conducting a $100,000,000 bought deal financing, which is live as we speak to advance the set of assets and for general corporate purposes. Sean touched on it. I'll just spell it out in a little bit more detail here. Cisco will be retaining a 5% NSR on Caribou as well as a 15% stream on what will be a fully financed San Antonio project and other royalties on some of the earlier stage assets. Worth pointing out that San Antonio was acquired by us with the intent of passing it to an operating entity. As this path took priority over some of the other paths we were looking for, for North Spirit, it became clear that our preferred partner was within the building. 20,000 ounces is what we expect the portfolio to generate when in production to a SCO royalties account with significant further upside in terms of expansion at both sets of assets. Cisco Royalties will be the majority owner of Cisco Development in the first instance. We will own 88% of the company as $100,000,000 are raised. We'll look to reduce that ownership level as the company finances and advances itself. But it's worth pointing out that we are doing this because we want retained exposure to the asset base. There's a lot of value to unlock for every dollar that goes into the ground. But that being said, we realize the flow for that company is not necessarily where it should be and we'll look to be opportunistic if and when we can be as some of the significant catalysts unfold. Flipping forward to Slide 5. Again, I think we've touched on a lot of these in terms of the rationale for both sets of companies, but I think it's important to go through it in a little bit more detail. From a fiscal development, well, just generally, let me take a step back. I think it's worth pointing out that really we're trying to set up 2 distinct companies with distinct mandates. Obviously, there's overlap in the first instance, but as both companies go down their paths, I think they'll settle in quite nicely. I don't think it's an overstatement to say that on the assisted development side, the assets are currently in the company to lead to a North American intermediate significance. 6,000,000 ounces of quality resources at Caribou on a brownfield site, a short flight out of Vancouver matters. It is a hugely scarce asset. That was our view when we took it in. That view has only grown in the past year, and we're more convinced than ever that Caribou is a mining camp and not just one large gold project. In conjunction with this announcement, we've also released some exploration results to catch up in terms of that news flow. News exploration results that we're quite bullish on that start to fill in the gaps between the existing resources and also outline some hugely exciting new discoveries along strike. In the meantime, as Caribou is being permitted, a Cisco development can bring on circa 100,000 ounces combined production from the Manzanol H Phase 2, which is a satellite of Caribou and the high grade low CapEx production from San Antonio, initially in oxides and then in high recovery sulfides. Sean mentioned the team. It's essentially the team that's built Canadian Malartic from first hole to Canada's largest gold mine in 6 years, and they will turn those talents on to the Barkerville camp and beyond. And I certainly appreciate the confidence that Sean and the Board has shown a need to take up the CEO role at Sysco Royalties. From an Sysco Royalties perspective, I think this transaction is fairly straightforward. It streamlines and simplifies the company to continue to focus on growing its royalty and stream base. We have a pretty exciting period in front of us on the OAR side with a high portfolio high quality portfolio of assets that we think matter in the sector, many of which are going to some compelling positive catalysts, including expansions, extensions, new discoveries and restarts. As well, our development weighting is starting to transition to the producer column on a lot of assets, which couldn't be happening at a better time in the gold cycle. I mentioned the addition of 20,000 ounces to our portfolio. I think it's also worth pointing out that all the people or pretty much all the people required for both these companies are already in the building. So by putting the right people in the right places, there will be a significant reduction in the G and A on the OR side as we move forward. And I also mentioned the disciplined approach we'll have to reducing ownership as and when warranted. I think the rerate opportunity we feel is significant here, and I'll touch on that in the next couple of slides at a high level as I imagine that that's probably going to be fairly well understood. So if you flip ahead to Slide 6, worth pointing out, probably not lost on anyone on this call that the conservatism and negativity brought on post Sperkel transaction has been evident. I don't think it's asset related on either side of the equation. It was structural. And what we've been saying is we'll fix the structure. We weren't frankly finished structuring the transaction when we announced it. With this transaction, we now are and frankly feel that some of that negativity has been overdone. And hopefully, we're going a long way today towards rectifying that. And then just to finish that point on Slide 7, you'll note the wide gap between ourselves and our peer group for what we think on the OR side is a pretty interesting set of assets with high growth in safe jurisdictions and a precious metal focus. So we think we'll have to continue to drive this point home, but we think there's a huge rerate or significant rerate potential in front of us. It's our job to go get it. And I think this is, as I said, not to repeat myself, one big step in that direction. So with that, I will pass it back to Sean. I think it's important for everyone to hear more about our fiscal development, what's happened to Barkerville for the past year, Here for the first time, we want this asset in Mexico, which we're quite enthusiastic about. So Sean, I'll pass it back to you on Slide 8. Thank you, Sandy. So as we go on to Page 8, the basic summary here on the production side is obviously Caribou is a big story with the PA study that we put out in September or sorry, in August of 2019, sort of being the foundation for this and then building on that as we move up. Currently sitting at 2,900,000 ounces at 4.7 grams in the measured and indicated category and another 2,500,000 ounces in the inferred category. So we are getting up there. There is ongoing drilling out there, and we've had quite a bit of success. In addition to the Caribou side of this, we have the Bonanza Ledge, which has 271,000 ounces, measured and indicated another 241,000 ounces in inferred at that site. And then we have 1,000,000 ounces sitting at San Antonio, bringing the overall resource here to north of 7,000,000 ounces within the company. But obviously, we want to get the producer status of this company as soon as possible. So the goal is to start production in January, February with the Bonanza Ledge, BC vein development that we've been working on. We've got just under 2 kilometers of development in there. We're shooting about 7 meters a day right now. We hope to have final scoping release from the Permian side to start processing our QR mill that we own sometime in January or February. And we're hoping that, that sort of delivers 25,000 to 35,000 ounces a year in the interim. The bigger production on Caribou will come as we go through the permitting process at Caribou. We've gone through the public hearing process, which was concluded in August, quite well run. And tip of the hat to our team there with Mike McPhee, Chris Loder and Chris Barna having driven that process as we went forward. We're in good stead with our friends from First Nations on this project and we hope to have some news for you on IBAs in the near term. So all those things are moving well. And I think that we use the time wisely. We feel that the larger permit has now been extended from the PE level 4,000 tons a day to 4,750 tons a day. In addition to that, we've purchased a combination circuit that was purchased by Hudbay in 2013 but never installed. So all the equipment is brand new at quite an advantageous rate with our partners from JDF Mining based in Kelowna. That equipment will be delivered to Quesnel or Prince George here in the New Year. But we have achieved that, which simplifies, I think, the detailed engineering for this project as we move forward. I'm also going to present to you the San Antonio project, which very few people know anything about. This was previously an oxide copper producer went bankrupt in 2018, and we've acquired it from that bankruptcy process, and we've rethought it as a gold project, which we're quite excited about. The other 2 land packages that we have here are mostly exploration ground. We won't get into that too much today, but we look at those as partnering opportunities as we go forward in this. And also, we will be keeping about $116,000,000 of equities in this company as we go forward, not the least of which will be the 19% plus that we own in Alamos as well as the just under 19% ownership in Falco Resources, both significant companies that we're proud to be associated with under the OR mandate, and I think they'll do well under the ODD mandate as well. So on Page 9, you can see what I was talking about. So we have 62,000 ounces coming at a Bonanza Lake in the 1st 2 years as we go through that permitting process. We have a small mine permit there that allows us to mine about 250,000 tons a year to generate those 63,000 ounces. Maybe they'll be processed in our existing QR bill, which we last operated in 2018 when we produced 23,000 ounces from that. The San Antonio project has about 40,000 ounces sitting on an existing pad with about 1,300,000 tonnes stacked on it. Previously, it was permitted for copper extraction when the process of converting that to gold extraction and hoping to have that back under irrigation sometime in the first half of next year and then on track to undertake the open pit mining and ore stacking in the full on mine plan for that project as we go forward. I just covered off Cariboo for the most part, but the expansion of 4,750 tonnes a day from the original 4,000 tons in PA study sets the stage for us to be at 200,000 ounces a year plus. And we'll also keep hopefully BQV and San Antonio contributing to that. So if all goes well within the 3 year period, 3 to 4 year period, we should be looking hopefully at a consolidated production of somewhere between 250,000,350,000 ounces. Page 10, I covered it a little bit in the preamble, but I have taken the role of CEO and Executive Chairman in both I'll be Executive Chairman of Osisko Gold Royalties as well as Executive Chairman and CEO for ODEB. Luc LaSarda is acting as Chief Operating Officer. You'll remember Luc, he was the CEO of Cisco One, currently acting as CEO of SALCO as well and supported by Francois, who is now VP of Technical Services and the entire Capito group that covers most disciplines from water management tailings, mining, milling and ESG. Chris Lower and Maggie Layland will continue to drive the exploration. Chris also carries a responsibility both on community relations and First Nations relations and all stakeholders as well as our political efforts in BC in terms of being part of the community and making sure that we contribute in a very positive way as we go forward. And as you can see, Benoit Brunei, who joined us from the CASE Depot, will be taking on the role of CFO. From a corporate governance standpoint, OR will still be a very significant shareholder of this or our fiduciary responsibility through the Board of OR. I'll be joining the Board, obviously, as Chairman. Charlie Page will take on the role of Lead Director John Brzezinski, Founder of Osisko 1 and currently CEO of Osisko Mining, OSK. And Joanne Forslund will come across and put in place proper Osisko style audit committee and everything that we need to have happen at ODEB and then we'll be reporting consolidated subsidiaries of our Avofisco royalties and we are NYSE listed, so we follow U. S. GAAP rules. So that's an important piece of business as we get further on in the story. As we evolve and raise money and go forward, we expect to see this company take more and more of its independence as we get closer to the production at Parker Mill. The next slide is a bit of a summary of our ESP credentials. For those of you who know us, we started the Canadian mine project in 2,005. We had quite a challenging project here and that we had to move 250 houses and we had 6 institutional buildings that we had or had to buy or replace. We ended up spending $180,000,000 to create a new suburb, move over 150 houses, create an industrial park for the town and also build a new suburb that ends up housing more than 300 houses. We built a brand new school for 425 children, a daycare for 111, 60 long term care facility rooms at the hospital, an amphitheater for 850 people. It's probably the nicest public amphitheater in the Abiquiri at this point in time and well used by the cultural community in that area as well as we committed to a Fund Assar, which is a fund that goes that's managed by local communities to support their community in the way that they see fit. That project, I think, has been the poster child for a lot of what sustainable development is. We were the first to pay 100% of our closure bonds in place, and we also developed a new system called continuous closure, where we didn't leave the mine reclamation to the end, that the reclamation is ongoing throughout the mining process. So pretty proud of our heritage on that and we look forward to bringing that to bear as we develop ODEB and we take on Caribou San Antonio and hopefully continued success on the exploration as we develop this mining camp. The next slide is really what I'm on about. On Page 12, as you can see, this is a very large area in terms of what we're doing. The it's kind of well is historic and that it was the largest town north of San Francisco, Barkerville and Wells back in the 1860s 70s when the boom came to be and it was the reason that British Columbia was incorporated in Canada at the time and not left as an open territory for Hudson's Bay Mining. Significant amount of historic resource over 5 100, 4,500,000 ounces of historic production from this camp, most recently, been shut down in about 1985, not necessarily due to lack of ore, but due to some on-site courses on the corporations that were operating there. Prior to our management to us was able to consolidate this entire area, And it's the first time that the entire land package has ever been consolidated and they're bringing us over 2,000 square kilometers of mineral rights for 2,008 hectares. So one of the largest plant packages in the world in terms of mineral rights. Currently sitting in total, including BTVA in the 3,200,000 ounces at 4.6 grams from as you indicated And inferred reserves of 2.7 grams, as you can see, over the 6,000,000 ounces of total reserves to date. And so it's still getting new discoveries all the time. The underground mine that we demonstrate here, you can see it on the map, is just in the town of Nelat. Well, if we mine there in 2018, then put it at 23,000 ounces from the other side of the thing. So we've driven a ramp into the BC vein, and we're going to start production there. The QR mill was a mill that was built by Kinross back in the day. It's a very good mill for metformineral ethanol equipment And it's set up as a CIT. We're doing some work to allow us to do CIL as well. This is a historic mill site fully permitted for cyanide and for tailings, and we'll be looking to use this mill as part of the bigger project as we go forward as well. The major advancements that we had in 2019 2020 while the company was, for the lack of a better term, private, We had new discoveries at the prospering and Loewe Williams K. L. That add access to the global resource. We also purchased a 1,000,000 equipment that I mentioned earlier. It's a 7,500 tonne of bay mill that we'll be adapting down to 4,750 to start with. Obviously, that leaves us lots of room for further success, assuming that exploration can come on. And we wouldn't have to do too much to upgrade this mill if the time then comes and we are successful on the exploration. We are also in the process of developing a ramp that hopefully will get us a bulk sample in 2021 from the underground. And as we said, the continuing, we have a 2 year mine plan right now for the Bonanza Ledge. More importantly, the big picture, feasibility is on track for next summer. We'll be targeting most of that measured indicator that we showed you. Inverness is a bold mineable reserve and hopefully a little bit more. For the feasibility study, obviously, we're going to that 4,750 tons a day And we're integrating some other aspects of this project, most importantly, to portal access, which is why we're able to go to the extra tonnage as we're essentially going to be having 2 different ramp access mines on each side of the valley connected by a ramp underneath the valley as well. The vision for the camp, again, is that we finish as the exploration continues for many years to come. And if we get it right, we're hoping to see sort of 5 to 10 ramp exit of access mines up and down these two trends. As you can see on the next slide, Slide 14. Very early days in terms of the step out. Most of the work has been focused on that green box that you see on the existing trends, and that's where the 6,000,000 ounces of resource that we've identified is present. And we have all these other deposits that are developing on trend. And we also have the new parallel trend, which we've discovered here in the last few years. And it really adds off to the technical team that did all the work. Our structural geologist guru, Terry Arber, currently the CEO of Talisker, Cliff Loder, Ruhl and Padilla, led the charge along with Maggie Lehman to really kind of craft the genetic code of this project, which had never been done before. And that's what led us to our success. And our exploration targeting went from 1 in 10 successful juggles when we got there to 8 to 9 out of 10. So it's been a highly successful exercise. And again, a tip of the hat to Terry and Ruben and Chris and Len and Maggie for having to figure all this stuff out because it really did change the way the game is working. And now we're solidly of the belief system that we have an entire mining camp to develop here, which sets the stage for years and years. Hopefully, this is a bit like owning Timmins, Red Lake or Kirkland Lake or maybe February back in the day, if you were back in the 1920s and 30s. So we don't see these kind of big caps end up in a single asset company or a smaller company very often. The last time we did it was at Canadian Malartic. And then John did it again at OFK with Windfall Link. And then we have other sister companies, Falco and Barkerville. So our group has been extremely fortunate in terms of developing these ramp out fill camps in Canada, and we're just thrilled to be able to bring this project back to the market in the current market conditions. As you can see on the bottom of this slide, we've only explored down to a depth of about 3 50 meters, significant amount of potential underground. We have 40 holes underneath the Callaway and shaft zones that demonstrate that mineralization does not stop there, but we didn't want to spend the money to drill it from surface. So we have significant upside at depth as well as a long strike on this. Some of the work that's going on is we've executed 500 kilometers or 500,000 meters of core drilling since we got involved in the project. Over 20,000 of soil sediment and rock samples and a significant amount of airborne surveying and 1,000 to 2,000 mapping has really sort of set the stage for what we believe is going to be a pretty exciting leg of the exploration story as it develops. Some of the new discoveries, if we move on to Page 15, that you can see in the yellow zones, the more rose colored zones represent the existing resource that's in the permitting acquisition sorry, in the permitting process that we've outlined for the 4,750 tonne a day underground mine development. But we've had success at Loewe, the KL Zone, Williams and then most recently, proserpine has come in quite nicely. You can see some of the grades that have been coming out here. It's 26 grams over 3 meters, 15 grams over 7.5 grams, 95 grams in assays. One of the things to take away from this is that when we reported the resources here, we've reported them as vein corridors, which really equate to log hole stoping rates because we've designated everything at least 2.2 meters wide. But if you were to look at just the quartz veins that contain the fire rate and the gold, the average grade is closer to 10.28. And the shaft zone, for example, is just under 12 grams once you separate it out, which is a reason why we're going to be introducing ore sorting technology in this project for about 50% of the lower grade components. We will be using an ore sorter that separates on XRF based on the fact that most of the ORF contained in the quartz veins and associated with the sulfides, but works extremely well because the XRF picks up sulfides. And that will be we'll get into more detail on that as we get further into the space. So I've covered a lot of detail here. I won't get into too much more because we do want to talk about San Antonio quite a bit. This project is somewhat new to the marketplace. It's located about an hour and a half outside of Vermicello and Sonora State. And what we have here is about 11,000 400 hectare land package. Mineralization is identified at about 5.7 kilometers. But it was mostly drilled with the intent of looking for oxide in the for copper mine. So we're retooling it as a gold project. We've identified 1,000,000 ounces of inferred here at 1.18 grams of which we think that somewhere between 200,000 to 300,000 ounces is in oxide where we've seen the recovery north of 80%. So this is pretty important piece. And we're also seeing significantly better than usual recoveries in the sulfide component transition material here, of 55% to 65% on 28 day follow out. So this is pretty exciting stuff. The CapEx here is relatively low to about 25 $35,000,000 to get up and starting to get us hopefully a 150000 to 70000 ounce a year producer with eyes on the peninsula drilling and some optimization of hopefully pushing the deposit as close to 100,000 ounce a year as we can get it and a significant amount of exploration upside that our team is quite happy to get on their way and going on. There is quite a bit of infrastructure in place here as well. As we flip to the next slide on Page 18, you can see this was a well built and well laid copper mine. Unfortunately, the previous owner, the principal business was driving this passed away and the company ended up in bankruptcy. But it is a very well organized site and it's a brownfield site that we feel we can go fairly quickly in terms of recommissioning. So I want to get on to the deal summary because it's been on the call for a little while. Page 19, really a summary on the bottom right hand corner. The pre money value of the deal was CAD 750,000,000 so about CAD 580,000,000. New equity of CAD 100,000,000 dollars post money value here of $850,000,000 And we think that that's very much in the current metrics at the low end of competitive projects, CEDIP, and retained ownership of the fiscal standard at 88%. From a fiscal global operating standpoint, we are very much in a position to keep this equity component on the books, and we make $150,000,000 a year in royalty revenue in a normal year with about a 91% gross margin. And currently, if Cisco's firepower on the balance sheet is about $510,000,000 So we're quite happy to stand and make shareholders as we go through this value process from the OR side. I won't get too much into the TA metrics, but you can have a look at those and if anybody has any cost. But I think the point to take away is we're still looking at producing around $700,000 $900,000 $800,000 $800,000 $800,000 all in sustaining costs with a significant life of mine. And that will be enhanced as we get through the feasibility for next summer. If you look at the PDA study, percentage of the resource model is not very high at this point in time. And you get to about $1,000,000,000 of value at $1600 gold on the NPV basis, which I think puts us in pretty good stead for the valuations that we proposed here. Not to forget that we have 100 and $16,000,000 of equities on the book. So if you take the equities off, the cash and the project will be trading around $7.50 Some of the more important metrics to look at on Page 22, combination of Caribou plus the resource at Caribou and San Antonio put you just slightly below Sabina. In terms of metrics and the Cipla development CapEx in our PA study of $306,000,000 because we are increasing size, there will be an incremental increase in CapEx as well. And we'll get that out to you as soon as we have the feasibility sort of more advanced. The life of mine looking at Caribou at 185,000 ounces in the PA study, and we'll be looking to do better than that. So let's say in addition to that 185,000 that we had in the PA, we would have 60,000 from San Antonio, another 31,000,000 from Bonanza Ledge, which sets the stage for a pretty solid entry into the mid tier gold production. We've shown you the enterprise value net of the cash and the equity book here at $650,000,000 puts us a pretty good company. You can see there's quite a few companies that are valued significantly higher than us. In terms of enterprise value for us, we come out about $70 an ounce at this point in time. So I think we have some room to move and that's going to be where we end up being the most positioned to sort of work on that as we take more risk off and we get closer to the final permits and we get some production going, we should be able to re rate fairly quickly with all those catalysts underway. The next page, on Page 24, really goes you through an enterprise value. We think this thing has a way to get to $1,000,000,000 once we see production come out. So that's the goal right now to crack that 1B mark as we get closer to production. Significant amount of meaningful cash flow and catalyst over the next 12 to 18 months San Antonio and BC Zane get going. And Chris Loder and Maggie continue to execute on the drill program and frame up some of these discoveries that we're following up now and hopefully get some ounces converted on that front as well. In terms of the team, I think you know us from the past, the Asysco platform has brought quite a few successes to the table. Obviously, OSK with John and the windfall team took windfall from our Cisco Mining to from an $8,000,000,000 mark cap in 20 16, they're currently sitting at $1,400,000,000 with one of the best exploration outcomes of this cycle at Red Windfall Lake. And we hit the Hackes of Oak has really done a great job of moving that project forward. And then in terms of Falco and Salisker and the Victoria team for having moved the Eagle project in the Yukon forward where we own 5% royalty. We think that we've been involved in a lot of the big successes on the Canadian mine too, and we're looking to continue that success with this team. And I'm very proud of everybody that's worked on the Osisko platform and all the efforts that have been made by everybody to get us where we are today. And certainly not least as our bread and bobs where it's in Cisco Metal and some of the success that you've had with the fine points to anything project up north. But we are a group that has invested a lot in exploration development, and we've been able to access capital to flow through for drilling in a way that none of the other groups have been able to do. And all that drilling has added up to royalties for the Osisko Gold royalty shareholder and set the table for what we believe is the next leg of the accelerator model. So I'm going to stop there. And if there's any questions for us, it would be a great time to chime in. We feel we've got a pretty good ride so far in terms of setting up this deal in terms of being able to deliver to you a product that we believe fits the time and the space in the current equity markets. On that note, Your first question comes from Ralph Profiti from 8th Capital. Your line is open. Please go ahead. Good afternoon, everyone, and thank you for taking my two questions. First of all, congratulations on the transaction. And Sean, if I could start, firstly, the decision to optimally go with 47, 50 tonnes per day, Is that really driven by the new mineral resources exploration? And how much trade off studies are going to be done at increasing that through potential? And how much scalability are we talking about here sort of in the medium term? And was that really behind the timing of that deal that you really felt like you had the project parameters or right size that now was the right time to do this transaction? That's my first question. Sure. I'll try and bring it home for you. The 4,750 tons a day is a step up from where you were at 4,000 tons a day. This is an underground mine. So it's not like an overfit where you can just fire up at 50,000 or in the case of a large, 250,000 tons a day of mining and feet of mill, 55,000 tons a day. We need that underground development to accelerate. So this is the largest underground mine that we can permit under the current conditions. We did purchase our milling equipment in a scalable way. But it will take us a couple of years after we start construction to get to that 4750 as we have to build that underground development into it. We'll see where we get to from there, but we're looking to come out with a feasibility with hopefully a little over 3,000,000 ounces of mineable reserve, which does support that $47,000,000 and also allows us some upside to look at things after we get up and running to see what we might do to continue on with that. In terms of the timing question, I think that we took a lot of risk off the table over the last 12, 13 months. We went through the public hearing permitting cycle, and we got into the final cycle, which we felt was a pretty good value driver. Support from the Taco Danae nation has been great, and we felt that we had their support on going forward with it. So that, coupled with the fact that we had committed last year through the North Spirit plan, that we would be using another vehicle, an OR, to develop this project. We were also able to conclude the acquisition of San Antonio in September, which set the stage for us, I think, to really drive the catalyst moment. Okay, we've got 2 great assets that have near term production capability in a gold market that looks like it needs to see another good project and a good company come to bear. So we felt that this was the right time to bring this to market based on the parameters of what we're seeing in valuations and in competing projects and where we've gotten to at this point. Yes. Got it. Thanks for that clarity. Sandeep, maybe I have a question for you, Sandeep, if I may. Just on your strategic initiatives post this transaction and how you when you think about valuation and you think about the development weighting coming down, where is your attention being put towards now as you think about sort of the next few years at Osisko Gold Royalties? Yes. Well, thanks, Ralph. And obviously, we'll continue on the path that we've been on. I think we had a lot going on, a lot going right in the company, I should say, and this is a bit of an overhang for the wrong reasons. I mean, obviously, the asset value we believe from the beginning needed to, as I said earlier, kind of finish the structuring. And so this is a key deliverable for this year. And And so this is a key deliverable for this year. And we think we've got the balance right, and hopefully, the market agrees with that. I think our our larger shareholders seem to as there's a lot of support for that financing that we're coming out with today and overall the split of the company. Look, we have a significant amount of catalysts internally. We've said all along that we want to get value for our current asset base. This is one step towards that. You mentioned the natural progression of a larger development weighting transitioning into the producer column. I think that's significant and important, and it's happening kind of with or without us with a lot of those development assets maturing. I think they were early maybe a couple of years ago, but now are maturing at arguably the best time in the gold cycle in a long time or maybe ever. So that's positive. The developments at Malartic Underground, we don't think are fully appreciated in our stock or our partner stocks for that matter. And as they continue to advance and put more meat on the bone, we think that's helpful. So look, we'll we have a lot to unlock and unpack from an internal perspective and things that we think we need to get paid for. And then externally, we'll continue on the path. I mean, we'll continue to look for value. I'll be honest, there hasn't been a lot of value in our minds to find recently. And so we'll pick our spots and we'll try to be a little bit different. We don't want to be exactly the same as everybody else, Ralph. We think that hybrid model, in its purest sense, is the absolute right model. Obviously, we deviated from it by buying the asset 100% and the means to an end, but heard that message loud and clear and underlined it. But the situation in the Accelerator Group where we're trying to put 10s and 20s to work and turn them into 102 100 has been wildly successful. And this is just another example where even today, based on the transaction value today, we're getting paid to take 20,000 ounces of GEOs, which women production, the going rate for that out there right now US0.05 dollars to US0.01 dollars So I think that works. We need to kind of keep it a little bit simpler for everybody and for ourselves, but that's a little bit of what we'll have on the go as we move forward. Yes, got it. Thanks very much and congratulations again. No problem. Thank you, guys. Your next question comes from John Chumaz from Independent Research. Please go ahead. Thank you. Good evening. I'm looking at the new resources of Caribou and Bonanza Wedge combined, it looks like the indicator dipped from 5.6 to 4.6 and the inferred from 5.0 to 3.9. Should we interpret that as a combination of mining dilution or the 2.2 meter width, the new zones added and a drop in the cutoff grade with higher gold prices? Yes. The bulk of the driver here, John, is that we did have some lower grade material that we drilled off. And with lower cutoff, we incorporated that. So we saw the midrud indicator go from 2,000,000 ounces at the PDA level up to about 2,900,000. So that 1,000,000 ounces that we've been able to include with the higher gold price that we felt was worth it. We also made some strides on the ore solar technology that we think may change as the economic on the low grade cutoff. And the advantage there is that there is an XRF, both and an optical sorter now over and above the XRF that allows you to make some economic decisions about the amount of sulfide that's held in the rock, if not whether it has sulfide or no sulfide. So based on the sign artwork and some of the other stuff that's underway, we were comfortable to lower that lower grade cutoff component down and then it fully bounces in. It cost us about $1.50 to $2 a tonne to use the ore sorter. And what we did with the evolution of how we're thinking about the mine plan is we only went after those low grade hales around the existing higher grade components that would run between 5 grams 6 grams that we had in the original PA study. But because we've already paid for the development to go in there, we felt that because there was no more development costs, we should take those lower grade components and upgrade them through the OARs order. So the way it ends up working now, John, is we've committed to that commutative circuit that we own. We're on the back of that, we'll be putting a flotation circuit in wells at the site. And about 50% of all the material from the higher grade components that will be running at 5 to 6 grams from just directly from mine stoping. And all the fines that are generated during crushing process will represent about 50% of the OR mine. And that goes directly to the flotation producing the 28 to 32 gram concentrate. The other 50% that we're mining from the underground will go to the ore sorter. And 3 gram material is going up to 6 gram material in the ore sorter for $1.50 a tonne to $2 a tonne and 4 gram material is going from 4 to 8 with the ore sorter. So it's a pretty economic outcome. And we don't need a lot of technology. These are relatively inexpensive units. We'll need 3 of them. They're about $1,700,000 each, so not a huge amount of capital. And what will happen at that point in time is from our underground mining, about onefour of all the underground mining will be at the well site, and we'll take that to the QR mill that we already own. And at the well site, and we'll take that to the QR mill that we already own. And we'll reduce that concentrate to we'll take that 28 to 32 gram concentrate, and we'll produce dore at the QR mill and we'll use the there'll be about 800 tons of tailings that will go to a dry stack there. And that also reduces our need for a tailings pond in Phase 1 at the well site and allows us to use the flotation circuit tailings as paste backfill. And then the ore sorter retest will be co disposed in a waste dump for development ore and the ore sorter rejects. So a bit of a long winded explanation, John, but it's an effect of the economic changes that we feel that we have enough effort to include in this decision. If I could ask one more. If eightnine of the company goes with OR worth $750,000,000 or $800,000,000 or say $550,000,000 or $600,000 Is it fair to apportion that as $400,000,000 to Barkerville, Caribou plus Bonanza Lodge, almost US100 $1,000,000 to the securities and almost US100 $1,000,000 to San Antonio, Guerrero, James Bay, Quebec, Coullon, other bits and pieces? Yes, we think that's not a bad split, John. So should we conclude from this that you couldn't get a company to pay you $600,000,000 cash for Caribou Alamo Gold, Kirkland, Agnico, and Australia and the Chinese, whoever? Or should we conclude that you want to keep it and think it's going to be worth more? It's definitely the latter, John. As you know, we've taken a viewpoint that this was a mining camp, not just a mining project. And as we saw at Malartic, I mean, we sold Malartic for CAD 4,300,000,000 in total consideration, CAD 3,900,000 at the time of the transaction back in 2014. Subsequent to that, there was 8,300,000 ounces in reserve. Subsequent to that, there's been more. And then now there's the underground 10,000,000 ounces. So there is a lot of value to be had in Barkerville. We've only really explored a postage stamp of the 2,000 square kilometer, and we've already got to 6,000,000 ounces. And we haven't even gone below 3 50 meters. So it's very early days to go for value. We most assuredly could sell this project at the top of the hat. There's really not too much else like it in the space right now, where you have this much upside and this many discoveries and a consolidated land package that includes 4,500,000 ounces of historic production and 150 kilometers of underground development, and we have access documented access to the data from all that work. So this is a highly valuable asset, John, and we will pursue it with prejudice to bring it to value for Noah shareholders as well as EOB shareholders. Yes. And I'll just reemphasize that, John, one more time. Certainly, the latter, not the former. I mean, what we said all year is we weren't interested in selling out 100% of the asset or even majority stake in the assets of the operating groups. That wasn't our focus. We looked for minority financial partners to fund the settlement money that takes it to the next set of catalysts. And the message is always we're going to own less and less of something that's more valuable as we think every dollar per month of this asset returns a multiple of it. And then as we pushed along and the markets changed, our view was this was the better mousetrap to accomplish that. And to assure people that OR would not be building this within OR, that fear and pessimism kind of kept coming up no matter what we were saying consistently between Sean and I. So we think that put this transaction today puts that to rest as well. So certainly, it's the latter, not the former. I might also add, I mean, the resource statement today is really just a point in time as we're coming out with the transaction to have 40 two-1 101 disclosure. Some of you would have heard Sean talk about it in our last quarterly financials that there are meaningful asset milestones that are coming up at the end of this year and beginning of next and some of the ones for the end of this year pushed into early next because of COVID. So that's those will be situations where we manage to infill drilling or finish infill drilling to get the reserves up to where Sean mentioned earlier as well as start to add these new discoveries onto the resource categories in more meaningful ways. Right now, we've done we're excited by them. They're as good as the early drilling into any of the portions of the deposit, but they haven't been drilled sufficiently to add to the book yet. Thank you very much. Thank you, John. Thanks, John. Give us a call if there's anything else that comes to mind. Sure. Your next question comes from George Topping from Industrial Alliance. Please go ahead. Sean or Sam, is there a minimum level of ownership that you see for Cisco royalties in the development? Look, I think it's going to be go ahead, Tony. Yes, I'll start, Sean. Look, I think it's going to be fluid. There's no minimum per se. We're not just handing out shares for no reason. As I said, we see significant value in these shares and the work that's going to be done. And then a pretty deep set of catalysts over the next 6 to 12 and beyond months. So I think we'll let the market finance the project and move it forward. We'll get diluted that way. Obviously, as I think I said earlier or hope I said earlier, we the flow is going to have to be kind of matured. We don't plan on only 80% of this. So we'll naturally come down as Sean pushes these assets forward aggressively. And then opportunistically, if we can look to promote a healthier flow for the company, we will. But it will be off the back catalysts and higher value for OAR shareholders. We've taken the ride thus far, taken the slings and arrows. We certainly want to benefit from the win. So we'll find the right balance, but obviously, it will come down. How quickly it will come down will be a virtue of how quickly it advances, but no preconceived notions today, George. Right. So you could go to 0 eventually if that's a possibility. Yes. Look, absolutely. I mean, what we Sean and I always said, and Sean first, and I echoed it since I joined, is there's a price for everything, including this. But our view is to get to the right price for the land package that Sean can be driving here, We need to continue. Now he needs to continue to unlock that value to really show what the camp looks like. But yes, ultimately, everything is always for sale. All right. Then for you, Sean, the assisted development, the equity portfolio, is your intention to be adding to that as we go forward and this be the main vehicle that would hold the equity stakes? Certainly, in the short term, George, our focus is going to be on achieving miners production mining production status. So capital on hand will go primarily to making sure that we get our permits on the bigger projects that we get BCD into production and get San Antonio up and firing as well. In the meantime, we're waiting to see what happens with some of the development assets that are in the portfolio. And a lot of good things happening in the at both Alamos and Falco and some of the other projects. So we're not in a rush there. But we won't be I don't think we'll be adding anything significant in the near term unless it's strategic for what we already are working Your last question comes from Brian MacArthur from Raymond James. Please go ahead. Good evening. Mine is sort of a bit of a follow-up on that. Looking at the portfolio, there is $27,000,000 of other transferred. I guess I'm just curious how you decided what was going to be transferred in the portfolio from OR to Cisco Development? Did we just clean everything up so you only have mining development and I assume metals still left in OR? Or you put sort of all the gold ones in there? Or how did you decide what the right amount or size was to transfer between the companies given this is partly a simplification exercise? Yes. You're right. It's a simplification exercise, Andy. So you go ahead. Yes. Sorry, Sean. Look, I think that's right, Brian. I mean, it was a balance. Some of those other positions are in and of themselves quite small. They were used to establish earlier stage royalties that we already have now within OR. So felt they made more sense within the development. What we kept sort of hearing the feedback. What we kept was, as you said, the core kind of OR brand or Cisco branded companies like Cisco Mining, Cisco Metals, some of the earlier names like say And those are considered often. Yes, yes. Well, that one Some of the earlier name stories that are just kind of setting out in life. And so I think it was a matter of finding that balance. There are names we certainly care about within this portfolio as well, but that was the general idea. Specifically with things like Osisko Mining, that's a big position for us kind of technically on our balance sheet. And these Cisco Royalty shareholders have helped to nurture that along to the success that it is today. So we did those tough years. We felt we deserved or our shareholders deserved the win either in terms of getting to production status or being one of the better names out there in the market. So yes, hopefully that answers your question a little bit, Brian, but a bit of a balancing act, if you will. Sure. That makes sense. Thanks very much. No problem. We have no further questions. Thank you very much everybody for giving us your time tonight. Please feel free to reach out to us, This concludes today's conference call. You may now disconnect.