Shareholder Notification — July 14, 2016

Over the past many months, shareholders have raised questions regarding option agreements, memorandums of understanding, and contracts.  MEDINAH would like to make several items regarding our contract with AURYN clear.

  1. MEDINAH started with a 51% interest in a little more than 3,000 hectares.  With AURYN’s help we were able to obtain a 100% interest in the mining claims for less than 40% dilution to our common shares.
  1. MEDINAH entered into an option agreement with AURYN which was announced on August 1, 2014.  This agreement was subsequently translated and published by MEDINAH.  The full agreement was published.  There were no hidden or secret NDA’s, side agreements, or addendums to this agreement.
  1. As per the announcements of both companies on May 16, 2016, the option agreement was cancelled and MEDINAH and AURYN reached a sales agreement in which MEDINAH exchanged our 100% ownership in approximately 3,000 hectares for 25,000,000 shares of AURYN and a 5-year option to acquire an additional 5,000,000 shares of AURYN for $50,000,000.  The 25,000,000 shares represent a 25% equity stake in AURYN.  Additionally, MEDINAH retains its 15% ownership in NUOCO.
  1. This is a very simple sales agreement.  We swapped our mining claims for equity in AURYN.  There are no hidden side contracts or addendums signed; nor will there be any signed.
  1. MEDINAH management believes this is a very beneficial sales agreement for our shareholders.

Before the agreement

  • 100% interest in approximately 3,000 hectares.
  • No cash resources or opportunities for early production.
  • No ability to pay the taxes to maintain claims or acquire surface rights without significant dilution.
  • No in-house mining experience.

After the agreement

  • 25% interest in over 10,500 hectares of consolidated claims making up the Altos de Lipangue (ADL) mining district.
  • Elimination of the need to dilute shareholders to cover taxes and surface rights.
  • A partnership with a capitalized company capable of developing the project.
  • Participation in early stage production opportunities including the Caren and Fortuna mines.

In summary, the sales agreement with AURYN allowed us to go from a position of weakness to a position of strength.  We gave up direct ownership in approximately 3,000 hectares which we had limited resources and ability to develop.  In exchange we gained a 25% equity stake in AURYN, a company on the cusp of becoming profitable through production on its Caren and Fortuna claims.  This agreement effectively ends the dilutive cycle that MEDINAH shareholders have endured through years of taxation, claims maintenance, and other expenses.

AURYN is sufficiently capitalized to bring the Caren and Fortuna claims into early production and achieve profitability.  We believe that MEDINAH will be able to maintain our interest in AURYN with no further share dilution for taxes, surface rights, or claims maintenance.  We expect to be profitable in 2017.



Cautionary Statement – Forward-Looking Information

This shareholder notification may contain certain “forward-looking statements” within the meaning of the United States Securities Exchange Act of 1934, as amended. This forward-looking information includes, or may be based upon estimates, forecasts and statements of management’s expectations with respect to, among other things, the completion of transactions, the issuance of permits, the size and quality of mineral resources, future trends for the Company, progress in development of mineral properties, future production and sales volumes, capital costs, mine production costs, demand and market outlook for metals, future metal prices and treatment and refining or milling charges, the outcome of legal proceedings, the timing of exploration, development and mining activities, acquisition of shares in other companies and the financial results of the Company. There can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially and substantially from those anticipated in such statements. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Inferred mineral resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that mineral resources will be converted into mineral reserves.