Crown Gold Signs Letter of Intent to Sell Three Nevada Properties for $16,000,000 in Cash and Securities
March 28 2011 - 3:54PM
Marketwired
Crown Gold Corporation ("Crown" or the "Company") (TSX VENTURE:
CWM) is pleased to announce that it has signed a letter of intent
with an arm's length private Canadian company, Argentium Resources
Inc. ("Argentium"), to sell Crown's Monte Cristo, Sugarloaf and
Blue Sphinx properties in Nevada to Argentium for $16,000,000 in
cash and securities. The three properties are held in Crown's
wholly-owned subsidiary, Gold Summit USA Corporation.
Argentium will pay $2,500,000 in cash, issue 13,500,000 shares
with a value of $1.00 each and issue 4,500,000 warrants (each
warrant will entitle the holder to purchase one additional
Argentium share for $1.50 at any time within 36 months after
closing, subject to acceleration in the event that the 20 day
volume weighted average trading price of Argentium's shares on a
Canadian stock exchange exceeds $2.00 per share for a period of 20
consecutive trading days). As well, Argentium has committed to
spend at least US$10,000,000 on exploration and development of the
three properties over the next three years. The transaction is
subject to a number of conditions, including approval by each
company's board of directors, due diligence by each company of the
other's assets, completion of formal documentation, completion by
Argentium of a financing of not less than $15,000,000 at a price of
not less than $1.00 per share, listing approval for Argentium's
shares for trading on a Canadian stock exchange and any other
necessary shareholder and regulatory approvals.
Crown has NI 43-101 compliant inferred resources totaling
approximately 339,000 ounces of gold at its Monte Cristo and
Sugarloaf properties. The Monte Cristo deposit has total inferred
resources of 1,923,349 tonnes grading 4.51 g/t Au above a cutoff of
1 g/t Au, containing about 279,000 ounces of gold. At the same
cut-off, the Sugarloaf deposit has indicated resources of 353,100
tonnes grading 3.27 g/t Au (about 37,000 ounces of gold) and
inferred resources of 293,500 tonnes grading 2.47 g/t Au (about
23,000 ounces of gold). The third property included in the proposed
transaction is Crown's Blue Sphinx property which contains
well-defined, essentially undrilled, targets.
Crown's President and Chief Executive Officer, Stephen Dunn
stated, "this transaction will allow our three Nevada properties to
be rapidly advanced by a company that is well financed and able to
source the necessary funding required to put Monte Cristo into
production. It not only recognizes the hidden value of our key
Nevada gold projects, but it also allows Crown shareholders to
continue to participate in their ongoing development through
Crown's shareholdings in Argentium. At the same time, Crown will
now be able to focus all of our exploration efforts on our Red
Lake, Sakoose and Gogama projects in Ontario with the benefit of a
strong balance sheet."
About Crown
Crown Gold, formed last year by the amalgamation of Crown
Minerals and Gold Summit, is exploring for high grade gold and
silver deposits in Nevada and Ontario.
In Ontario, Crown has its McKenzie Island property at Red Lake
where a spring work program is being planned to follow up on its
successful drill program this past February that yielded promising
results, including 2.2 oz/gold over 3 feet (see Crown's news
release dated March 3, 2011). Crown's other northwest Ontario
properties are its Sakoose property near Kenora and its Surprise
Lake property in the Uchi Belt, east of Red Lake. In northeastern
Ontario, Crown holds three other strategic land positions: one
adjacent to Trelawney's Chester discovery near Gogama, another at
the old Stairs Mine near Matachewan and a third in the heart of the
Timmins camp.
In Nevada, in addition to its Monte Cristo, Sugarloaf and Blue
Sphinx properties, Crown has two other gold exploration properties,
Gold Springs and Black Warrior, each of which contains
well-defined, essentially undrilled, targets.
Larry Kornze, Senior Consultant to Crown Gold and a registered
Professional Engineer/Geologist, is designated as the Qualified
Person under National Instrument 43-101 and has reviewed and
approved the contents of this news release.
For more information please see the Crown website at
www.crowngoldcorp.com.
This press release contains forward-looking statements within
the meaning of applicable Canadian and U.S. securities regulation,
including statements regarding the future activities of the
Company. Forward-looking statements reflect the current beliefs and
expectations of management and are identified by the use of words
including "will", "anticipates", "expected to", "plans", "planned"
and other similar words. Actual results may differ significantly.
The achievement of the results expressed in forward-looking
statements is subject to a number of risks, including those
described in the Company's management discussion and analysis as
filed with the Canadian securities regulatory authorities which are
available at www.sedar.com. Investors are cautioned not to place
undue reliance upon forward-looking statements.
Neither 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.
Contacts: Crown Gold Corporation Mr. Stephen Dunn President and
CEO (416) 361-2827 Crown Gold Corporation Dr. Anthony Taylor
Executive Chairman (775) 284-7200 info@crowngoldcorp.com
www.crowngoldcorp.com Investor Cubed Christian Scovenna
416-363-9694 or 1-888-258-3323 info@investor3.ca
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