Great Bear Resources Ltd. (TSX-V: GBR) announces that is has entered into a 2.0% net smelter return royalty agreement with a newly incorporated wholly-owned subsidiary named Great Bear Royalties Corp. Great Bear plans to transfer the NSR Royalty, approximately $1 million in marketable securities currently owned by the Company, and $0.5 million in cash into Great Bear Royalties, which together will be the initial assets for a new royalty company. Great Bear will continue to focus on advancing the 100% owned Dixie Project, while Great Bear Royalties will allow shareholders to capture additional long-term value through the royalty interest.

Great Bear Royalties will not initially be listed on a public stock exchange but will operate as a reporting issuer. Great Bear Royalties will evaluate all strategic opportunities available to the company to enhance value.

Terms of the Arrangement Agreement

Great Bear has executed an arrangement agreement with Great Bear Royalties, whereby the business of Great Bear will be reorganized into two companies by way of a plan of arrangement under the Business Corporations Act (British Columbia). Great Bear shareholders will vote on the Arrangement at a special meeting of shareholders to be held on a date to be announced. To be effective, the Arrangement must be approved by a special resolution passed by at least 66⅔% of the votes cast by Great Bear shareholders present in person or represented by proxy at the Meeting, which shareholders are entitled to one vote for each Great Bear share held.

The Arrangement involves, among other things, the distribution of 100% of the common shares of Great Bear Royalties to Great Bear shareholders such that each shareholder as of a particular date, immediately prior to closing of the transaction will receive one  share of  Great Bear Royalties for each four common shares of Great Bear held as of the Record Date. It is anticipated that the closing date will occur in April 2020. Great Bear warrants and options will also be adjusted pursuant to the Arrangement as described in more detail in the information circular that will be mailed to shareholders prior to the Meeting.

After careful consideration, the Board of Directors has unanimously determined that the Arrangement is fair to shareholders and is in the best interests of the Company. A description of the various factors considered by the Board of Directors in arriving at this determination will be provided in the Circular.

After closing of the Arrangement, Great Bear shares will continue trading on the TSX Venture Exchange in Canada under the symbol GBR, and on the OTCQX Market in the United States under the symbol GTBDF. Great Bear Royalties Shares will not be listed on any stock exchange after closing of the Arrangement, but the company will be a reporting issuer and will comply with its continuous disclosure obligations including press releases and financial reporting.

Grant of Stock Options

The Company also reports it has granted an aggregate of 710,000 stock options to employees, directors, consultants and advisors of the Company, exercisable at $8.67 per share for a period of five years. The options are subject to a four month hold period.

About Great Bear

Great Bear Resources Ltd. is a well-financed gold exploration company managed by a team with a track record of success in mineral exploration.   Great Bear is focused in the prolific Red Lake gold district in northwest Ontario, where the company controls over 300 km² of highly prospective tenure across 4 projects: the flagship Dixie Project  (100% owned), and the Pakwash Property (earning a 100% interest), the Dedee Property (earning a 100% interest), and the Sobel Property (earning a 100% interest), all of which are accessible year-round through existing roads.