Contango ORE, Inc. (OTCBB:CTGO.PK) (the “Company”) announced today that
it has entered into a Master Agreement with Royal Gold, Inc. (“Royal
Gold”) for the formation of a joint venture to advance exploration and
development of its Tetlin properties, subject to the approval of the
Company’s stockholders to be held later this year and the satisfaction
of other conditions.
The Master Agreement provides for the contribution by the Company to the
joint venture of its Tetlin lease and State of Alaska mining claims near
Tok, Alaska prospective for gold and associated minerals, together with
other personal property, which are collectively valued at $45.7 million
by the joint venture.
Upon closing of the Master Agreement, the parties will form a limited
liability company to hold the joint venture assets, and the joint
venture will be managed according to a Joint Venture Agreement. Royal
Gold will invest $5 million initially to fund exploration activity, and
will have the option to earn up to a 40% economic interest in the joint
venture by investing up to $30 million (inclusive of the initial $5
million investment) prior to October 2018. The proceeds of Royal Gold’s
investment will be used by the joint venture for additional exploration
and development of the Tetlin properties.
The Company anticipates seeking approval of its stockholders at its
annual meeting of stockholders to be held later this year. No record
date or meeting date has yet been set for the annual meeting. In
connection with the execution of the Master Agreement, Company
stockholders holding beneficial ownership of approximately 39% of the
Company’s stock have agreed to vote in favor of the Royal Gold joint
venture transaction.
In connection with the Royal Gold transaction, Brad Juneau, President
and CEO of the Company, said, “We are excited that Royal Gold has agreed
to join our effort to expand upon the promising exploration work we have
initiated on the Tetlin lease and neighboring claims covering over
750,000 acres. Royal Gold has demonstrated experience and expertise that
will be invaluable in expanding upon our Chief Danny Prospect, including
the Peak Zone discovery. We look forward to working with Royal Gold on
this venture.”
About Contango
Contango ORE, Inc. is a Houston-based company that engages in the
exploration in Alaska for gold and associated minerals. Additional
information can be found on our web page at www.contangoore.com.
About Royal Gold
Royal Gold, Inc. (“Royal Gold”) is a precious metals royalty company
engaged in the acquisition and management of precious metal royalties,
streams and similar production based interests. Royal Gold’s portfolio
consists of 201 properties on six continents, including interests on 37
producing mines and 23 development stage projects. Royal Gold is
publicly traded on the NASDAQ Global Select Market under the symbol
“RGLD,” and on the Toronto Stock Exchange under the symbol “RGL.” Royal
Gold’s website is located at www.royalgold.com.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements concerning the
proposed transaction between the Company and Royal Gold, the expected
timetable for completing the proposed transaction, its financial and
business impact, management’s beliefs and objectives with respect
thereto, and management’s current expectations for future operating and
financial performance. Forward-looking statements regarding the Company
are intended to be covered by the safe harbor “forward-looking
statements” provided by the Private Securities Litigation Reform Act of
1995, based on the Company’s current expectations and includes
statements regarding future results of operations, quality and nature of
the asset base, the assumptions upon which estimates are based and other
expectations, beliefs, plans, objectives, assumptions, strategies or
statements about future events or performance (often, but not always,
using words such as “expects,” “projects,” “anticipates,” “plans,”
“estimates,” “potential,” “possible,” “probable,” or “intends,” or
stating that certain actions, events or results “may,” “will,” “should,”
or “could” be taken, occur or be achieved). Forward-looking statements
are based on current expectations, estimates and projections that
involve a number of risks and uncertainties, which could cause actual
results to differ materially from those reflected in the statements.
These risks include, but are not limited to: the risks of the
exploration and the mining industry (for example, operational risks in
exploring for, developing mineral reserves; risks and uncertainties
involving geology; the speculative nature of the mining industry; the
uncertainty of estimates and projections relating to future production,
costs and expenses; the volatility of natural resources prices,
including prices of gold and rare earth elements; the existence and
extent of commercially exploitable minerals in properties acquired by
the Company; potential delays or changes in plans with respect to
exploration or development projects or capital expenditures; the
interpretation of exploration results and the estimation of mineral
resources; the loss of key employees or consultants; health, safety and
environmental risks and risks related to weather and other natural
disasters); uncertainties as to the availability and cost of financing;
inability to realize expected value from acquisitions; inability of our
management team to execute its plans to meet its goals; and the
possibility that government policies may change or governmental
approvals may be delayed or withheld, including the inability to obtain
any mining permits. Additional information on these and other factors
which could affect the Company’s exploration program or financial
results are included in the Company’s other reports on file with the
Securities and Exchange Commission. Investors are cautioned that any
forward-looking statements are not guarantees of future performance and
actual results or developments may differ materially from the
projections in the forward-looking statements. Forward-looking
statements are based on the estimates and opinions of management at the
time the statements are made. The Company does not assume any obligation
to update forward-looking statements should circumstances or
management’s estimates or opinions change.
ADDITIONAL INFORMATION ABOUT THE PROPOSED TRANSACTION AND WHERE TO
FIND IT
In connection with the proposed transaction, the Company intends to file
a proxy statement and other relevant documents with the SEC regarding
the proposed transaction. INVESTORS ARE URGED TO READ THE PROXY
STATEMENT AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF AND WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE PROPOSED JOINT VENTURE. You may obtain a free copy of the
proxy statement (if and when it becomes available) and other relevant
documents filed by the Company with the SEC at the SEC’s website at www.sec.gov.
You may also obtain these documents by contacting the Company at
713.294.8380 or the Company’s website.
Copyright Business Wire 2014