Osisko Development Corp. (TSX-V:ODV)  (NYSE:ODV) is pleased to announce the completion of its previously announced acquisition of Tintic Consolidated Metals LLC, which owns the producing Trixie test mine, as well as mineral claims covering more than 17,000 acres (including over 14,200 acres of which are patented) in Central Utah’s historic Tintic Mining District. For additional details regarding the Transaction, please refer to the Company’s news release dated January 25, 2022.

Mr. Sean Roosen, Chair and Chief Executive Officer of Osisko Development commented: “With the acquisition of Tintic we have inherited not only a highly prospective test mine in the Trixie project, but also a large, historic land package in one of the world’s premier mining jurisdictions. Through underground exploration, we hope to continue to expand the mineralization footprint along the T2 and T4 zones. We have engaged drilling contractors and look forward to sharing the results with you as we progress the understanding of this ground. We are also looking forward to working with, and supporting, the stakeholders in our project, including the local communities in Utah and Juab counties.”

Osisko Development’s near term plan is to initiate underground and at surface drilling while it continues exploration development and processing of the mineralized material at the Trixie project. Drilling is targeting support for preparation of an initial resource statement pursuant to National Instrument 43-101 over the next twelve months. Concurrently, the Company will complete advanced technical studies on the project to generate additional surface and underground targets, conduct metallurgical testing, geotechnical work and environmental studies to justify further development as well as increase production through a low-capital expenditure expansion.¹

Under the terms of the Transaction, Osisko Development will fund the acquisition through the issuance of (i) 12,049,449 common shares in the capital of the Company, (ii) aggregate cash payments of approximately US$54 million, (iii) the issuance of an aggregate of 2% NSR royalties, with a 50% buyback right in favour of the Company exercisable within five years, (iv) US$12.5 million in deferred payments, and (v) the granting of certain other contingent payments, rights and obligations.

The Company is also pleased to announce that it has entered into a binding term sheet with Osisko Bermuda Limited, a wholly-owned subsidiary of Osisko Gold Royalties Ltd, for a stream on the metals produced from Tintic for total cash consideration of US$20 million. Under the Stream, the Company will deliver to OBL 2.5% of all metals produced from Tintic at a purchase price of 25% of the relevant spot metal price. Once 27,150 ounces of refined gold have been delivered, the Stream rate will decrease to 2.0% of all metals produced. Closing of the Stream is expected to take place on or before July 31, 2022 and is subject to customary closing conditions, including receipt of applicable regulatory and stock exchange approvals. The proceeds from the Stream will be used for to advance the development of Tintic.

The Stream is a “related party transaction” for purposes of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions as OBL is a “related party” of the Company for purposes of MI 61-101. The Company intends to rely upon exemptions from (i) the formal valuation requirements of MI 61-101 in reliance on Section 5.5(b) of MI 61-101, and (ii) the minority approval requirements of MI 61-101 in reliance on Section 5.7(1)(a) of MI 61-101 insofar as the fair market value of the subject matter of, and the consideration for, the Stream does not exceed 25% of the market capitalization of the Company. The Stream has been approved by the independent directors of the Company.  Completion of the Stream is subject to the negotiation and execution of definitive documentation, and obtaining any regulatory, including approval of the TSX Venture Exchange.

In addition, with the closing of the Transaction, the Company has satisfied the escrow release conditions relating to the 13,732,900 subscription receipts of the Company issued at a price of C$4.45 per Subscription Receipt for gross proceeds of approximately C$61.1 million, which were issued on a bought deal private placement. The gross proceeds of the Offering and accrued interest thereon, net of the commission (accrued interest thereon) and expenses payable to the underwriters of the Offering, will, upon the delivery of the escrow release notice, be released to the Company and each Subscription Receipt will be converted into (i) one-third of one Common Share, and (ii) one-third of one Common Share purchase warrant of the Company, with each Warrant entitling the holder thereof to purchase one Common Share at a price of C$22.80² until March 2, 2027. The net proceeds of the Offering will be used to advance the development of the Company’s mineral assets.

About Osisko Development

Osisko Development Corp. is uniquely positioned as a premier gold development company in North America to advance the Cariboo Gold Project and other Canadian and Mexican properties, with the objective of becoming the next mid-tier gold producer. The Cariboo Gold Project, located in central British Columbia, Canada, is Osisko Development’s flagship asset. The considerable exploration potential at depth and along strike distinguishes the Cariboo Gold Project relative to other development assets. Osisko Development’s project pipeline is complemented by its interest in the San Antonio gold project, located in Sonora, Mexico and the Trixie gold test mine, located in Utah, USA.