VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan 21, 2013) - True North Gems Inc. (TSX VENTURE:TGX) ("True North" or the "Company") announces it has entered into an agreement to sell its 100% interest in the Bandito project in the Yukon Territory to Endurance Gold Corporation (TSX VENTURE:EDG) ("Endurance") for a combination of shares and cash.
True North President and CEO Nick Houghton said: "The Bandito project was a non-core asset for the Company; as such this sale ensures all focus remains on moving the Aappaluttoq ruby project in Greenland into commercial production."
Under the agreement, Endurance will pay True North five million Endurance common shares and $50,000 cash following TSX Venture Exchange acceptance of this agreement. One million of the common shares will be subject to the standard hold period, while the remaining four million shares will be issuable in two tranches of two million shares each. The hold periods of these two tranches expire on July 1, 2013 and December 31, 2013, respectively.
True North has reserved a 1% net smelter royalty ("NSR"), with Endurance having the right to purchase one-half of the NSR at any time upon payment of $1 million. A further cash payment of $500,000 will be payable to True North in two tranches with the initial $150,000 payable upon completion and filing of a bankable feasibility study on the Bandito project, with the balance to be paid after project financing has been obtained to place the Bandito project into commercial production.
The Bandito property is located in the Yukon Territory, east of Watson Lake, and was discovered by True North in 2003. True North geologists discovered nickel and copper prospects over a quartz-sericite-pyrite alteration zone, and several years of exploration were conducted in the 2003-2008 period. Since 2010 the project has been under option to Endurance. This agreement replaces any existing contract between EDG and TGX. The transaction is subject to TSX Venture Exchange approval.
This document contains "forward-looking information" and "forward-looking statements" (together, "forward-looking statements") within the meaning of applicable securities legislation, which are made as of the date of this document or the document(s) referred to herein. Statements that express predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects", "anticipates", "plans", "projects", "estimates", "intends", "strategy", "goals", "objectives" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements. Forward-looking statements include, without limitation, statements with respect to: the amount of mineral reserves and mineral resources; the amount of future production over any period; net present value and internal rates of return of the proposed mining operation; capital costs; operating costs; strip ratios and mining rates; and mine life. The forward-looking statements are made based upon certain assumptions which, if untrue, could cause the actual results, performances or achievements of the Company to be materially different from future results, performances or achievements expressed or implied by the forward-looking statements. These assumptions include, without limitation: the price of gemstone products produced; anticipated costs; the presence of and continuity of gemstones at modeled grades and values; the capacities of various machinery and equipment; the availability of personnel, machinery and equipment at estimated prices; exchange rates; appropriate discount rates; tax rates applicable to the proposed mining operation; financing structure and costs; anticipated mining losses and dilution; gemstone recovery rates; reasonable contingency requirements; and receipt of regulatory approvals on acceptable terms. By their very nature, forward-looking statements involve inherent risks and uncertainties that could cause actual results, performances or achievements to differ materially from those in the forward-looking statements. These include, without limitation: price volatility, discrepancies between actual and estimated production, mineral reserves and resources and metallurgical recoveries, mining operational and development risks, regulatory restrictions (including environmental regulatory restrictions and liability), activities by governmental authorities (including changes in taxation), currency fluctuations, the speculative nature of gemstone exploration, the global economic climate, dilution, share price volatility, competition, loss of key employees; additional funding requirements and defective title to mineral claims or property]. This list is not exhaustive. See also, for example, the risks disclosed in the Company''s other disclosure documents filed at www.sedar.com, including, without limitation, those disclosed in the Company''s management''s discussion & analysis. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements, except as otherwise required by applicable securities legislation.