Callinan Royalties Agrees to $1 Million Investment into Golden Dory
and Acquisition of Option to Acquire Royalty Interests on the Iron
Horse Property
TSXV: CAA
VANCOUVER, Nov. 8, 2012 /CNW/ - Callinan Royalties
Corporation ("Callinan") has signed an agreement with Golden Dory
Resources Corp. ("Golden Dory") whereby Callinan has agreed to
invest $1 million by way of private
placement into Golden Dory and,
concurrent with closing the financing, Callinan will acquire two
royalty options from Golden Dory on
the Iron Horse Property owned by the Golden Dory-Metals Creek Joint
Venture. Golden Dory is the project
operator and can earn up to 70% interest in the Iron Horse Property
located in western Labrador,
Canada where intersections of iron formation have been
reported by Golden Dory from recent
drilling programs. Golden Dory has
agreed to spend $1 million in
exploration on the Iron Horse Property before the end of 2013.
The first option will allow Callinan to purchase
a 1% royalty for $1 million. A
second option will allow Callinan to purchase up to an additional
1.1% royalty at a price to be calculated by an independent third
party based on information from the final bankable feasibility
study used for mine construction. The royalty options will be
exercisable at any time up to 180 days following 180 days of
continuous commercial production.
Under Golden
Dory's private placement, Callinan will acquire 14,285,714
units of Golden Dory at a price of
$0.07 per unit. Each unit under
the private placement will consist of one common share and one
common share purchase warrant. Each warrant will entitle Callinan
to purchase one additional common share of Golden Dory at an exercise price of $0.10 for a period of two years following the
closing of the private placement. However, Golden Dory will not issue, during the term of
the warrants, shares upon exercise of the warrants held by Callinan
that will result in Callinan holding more than 19% of the issued
and outstanding shares of Golden
Dory. Closing of the private placement and grant of royalty
options is expected to occur on or about November 12, 2012.
Callinan is pleased to enter this mutually
beneficial agreement with Golden
Dory, which has demonstrated exploration success on an early
stage property. Callinan will become a significant shareholder in
Golden Dory while holding royalty
options in Canada's premier iron
ore mining region.
On Behalf of the Board of Directors,
Roland Butler
Roland Butler, CEO
About Golden Dory
Golden Dory Resources Corp. (TSX.V-GDR) is primarily focused on
iron ore exploration at the Iron Horse Project in Newfoundland & Labrador, Canada; and in the Long Canyon
district (Pequop South), and Reef properties in the state of
Nevada, USA.
About Callinan
Callinan Royalties is a Canadian company that
creates and acquires mineral royalties. The company uses its
royalty income to provide alternative financing options to mineral
exploration and development companies with attractive
projects. Callinan's strategy is to create shareholder value
over the long term by generating a portfolio of profitable mineral
royalties.
The Corporation currently has two producing
royalties. Callinan holds a 6⅔% net profits interest royalty and a
$0.25 per ton royalty on lands that
include the 777 Mine owned by HudBay Minerals Inc. located in
Flin Flon, Manitoba, Canada as
well as the adjacent 777 North Mine scheduled for production in
2012. Callinan also holds the 777 Deeps (War Baby) property and an
associated royalty option on the property, which is located
adjacent to the 777 Mine.
Callinan is a dividend paying Tier 1 company
listed on the TSX Venture Exchange under the symbol CAA. The
Corporation has a strong financial position with no debt,
approximately $29 million in cash and
approximately 48.2 million shares outstanding.
Cautionary Statement on Forward-Looking Information
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. Certain of the
information presented in this News Release may constitute
"forward-looking statements" or "forward-looking information"
within the meaning of Canadian securities legislation (together
referred to as "forward-looking statements"). The forward-looking
statements are subject to risks, uncertainties and other factors
that may cause actual results to be materially different from those
expressed or implied by such forward-looking statements, including
any delays in the receipt of consents or approvals. Although
Callinan Royalties has attempted to identify important factors that
could cause actual actions, events or results to differ materially
from those described in forward-looking statements, there may be
other factors that cause actions, events or results not to be as
anticipated, estimated or intended. There can be no assurance that
such statements will prove to be accurate as actual results and
future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue
reliance on forward-looking statements contained in this News
Release and in any document referred to in this News Release.
Forward-looking statements are made based on management's beliefs,
estimates and opinions on the date the statements are made and
Callinan Royalties undertakes no obligation to update
forward-looking statements if these beliefs, estimates and opinions
or other circumstances should change, except as required by
applicable law.
SOURCE Callinan Royalties Corporation