Dundee Precious Metals Reaches Agreement to Sell its Back River Project in Nunavut to Sabina Silver Corporation
March 30 2009 - 7:00AM
Marketwired
Dundee Precious Metals Inc. (TSX: DPM)(TSX: DPM.WT)(TSX: DPM.WT.A)
("DPM" or the "Company") announced today that it has entered into a
definitive agreement with Sabina Silver Corporation (TSX VENTURE:
SBB) ("Sabina") to sell its Back River exploration project in
Nunavut, in consideration for cash and securities of Sabina.
Pursuant to the definitive agreement, the Company will receive
in exchange for the Back River project:
- Cdn$7 million in cash;
- 17,000,000 Sabina common shares (representing approximately
18.8% of the current outstanding common shares of Sabina);
- 5,000,000 Series A Special Warrants; and
- 5,000,000 Series B Special Warrants
Each of the Special Warrants will be comprised of one common
share and one-half of one common share purchase warrant of Sabina.
The Series A Special Warrants will be automatically exercised upon
a decision to proceed to a feasibility study or proceed to
production on the Back River project. The Series B Special Warrants
will be automatically exercised upon a positive production decision
with respect to the project. Each whole share purchase warrant will
be exercisable for five years from the closing date of the
transaction, at the discretion of DPM, for one Sabina common share
at a price equal to the volume weighted average of the Sabina
common shares on the TSX-V for the five consecutive trading days
ending on the trading day prior to the closing.
"We have always recognized the value of the Back River assets
however, with our focus clearly on advancing our Bulgarian assets,
this transaction provides us with an opportunity to continue to
participate in Back River's growth and development without
diverting resources from our core business", said Jonathan Goodman,
President & CEO. "Back River is an excellent exploration
property that will complement the adjacent Sabina properties
allowing DPM to become a significant shareholder in a much larger
exploration venture run by one of the best exploration groups in
Canada."
DPM will be entitled to two nominees on the board of directors
of Sabina as long as it holds a 15% interest in Sabina and to one
nominee as long as it holds a 10% interest.
The transaction is subject to various conditions, including
regulatory (including TSX-V) and any required Sabina shareholder
approvals.
FORWARD LOOKING STATEMENTS
This news release may contain certain information that
constitutes forward-looking statements. Forward-looking statements
are frequently characterized by words such as "plan", "expect",
"project", "intend", "believe", "anticipate" and other similar
words, or statements that certain events or conditions "may" or
"will" occur. Forward-looking statements are based on the opinions
and estimates of management at the date the statements are made,
and are subject to a variety of risks and uncertainties and other
factors that could cause actual events or results to differ
materially from those projected in the forward-looking statements.
These factors include the inherent risks involved in the
exploration and development of mineral properties, the
uncertainties involved in interpreting drilling results and other
geological data, fluctuating metal prices and other factors
described above and in the Company's most recent annual information
form under the heading "Risk Factors" which has been filed
electronically by means of the Canadian Securities Administrators'
website located at www.sedar.com. The Company disclaims any
obligation to update or revise any forward-looking statements if
circumstances or management's estimates or opinions should change.
The reader is cautioned not to place undue reliance on
forward-looking statements.
Dundee Precious Metals Inc. is a Canadian based, international
mining company engaged in the acquisition, exploration, development
and mining of precious metals. DPM owns the Chelopech Mine, a
producing gold/copper mine, and the Krumovgrad Gold Project, a
mining development project, both located in Bulgaria, and is
engaged in mineral exploration activities in Serbia. In addition,
Dundee Precious owns the Back River gold exploration project in
Nunavut, Canada and a 95% interest in the Kapan Mine in
Armenia.
Contacts: Dundee Precious Metals Inc. Jonathan Goodman President
& Chief Executive Officer (416) 365-2408 Email:
jgoodman@dundeeprecious.com Dundee Precious Metals Inc. Lori Beak
Vice President, Investor Relations and Corporate Secretary (416)
365-5165 Email: lbeak@dundeeprecious.com
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