Conditional approval by the TSX Venture Exchange of the proposed sale of Calico's Grassy Mountain Gold Project

VANCOUVER, Dec. 16, 2013 /PRNewswire/ -

Conditional Approval:

Further to Calico's December 3, 2013 news release in which Calico announced that it was to sell its Grassy Mountain Project to Rockstar Resources, Inc. by way of selling its wholly owned Nevada subsidiary, Calico advises that it has obtained Conditional Approval from the TSX Venture Exchange to the proposed transaction.  The closing of the proposed sale to Rockstar cannot occur without Calico first receiving final approval from the TSX Venture Exchange, which final approval Calico expects to receive immediately following its shareholder meeting.

Shareholder Meeting:

Calico has now set the date for the meeting of the shareholders.  The Annual General and Special Meeting will be held on Wednesday February 19, 2014 in Vancouver, British Columbia.

In addition to the customary things to be considered at an annual general meeting of shareholders the shareholders will be asked to approve two pieces of special business:

(a)       the potential sale of the Grassy Mountain Project by way of the sale of Calico's wholly owned Nevada subsidiary, Calico Resources USA Corp.; and
         
(b)        the exercise of special warrants held by Seabridge Gold Inc. and the resulting change of control.

Exercise of Special Warrants and Resulting Change of Control:

Calico acquired the Grassy Mountain Project from Seabridge Gold Inc. ("Seabridge Parent") and its wholly owned USA subsidiary, Seabridge Gold Corporation ("Seabridge USA") by way of a property option (the "Option") which was exercised on February 5, 2013 pursuant to the terms of the option agreement with Seabridge (the "Seabridge Option Agreement").  Seabridge Parent presently holds 10,104,000 Calico shares representing 19.55% of the 51,695,369 issued and outstanding shares in Calico and Seabridge Parent owns 2,896,000 special warrants in the capital of Calico.  Each special warrant is exercisable for no additional consideration to acquire a further share of Calico.  Upon Seabridge exercising all of its special warrants, Seabridge will own 13,000,000 Calico shares representing 23.81% of the then 54,591,369 issued and outstanding shares in Calico (assuming no other share issuances by Calico).

All of the shares and special warrants presently held by Seabridge were acquired by Seabridge under the Seabridge Option Agreement.

The terms of the special warrants include a restriction from Seabridge Parent exercising that number of special warrants such that Seabridge would own more than 20% of the issued shares in Calico unless the shareholders of Calico have first approved the exercise of the special warrants and the resulting change in control in Calico.  Under the terms of the Seabridge Option Agreement Calico is required to seek shareholder approval of the exercise of special warrants by Seabridge Parent and the resulting change in control.

Further, Seabridge has agreed with Calico to sell its 10% net profits interest and a related put option (the "10% NPI and NPI Put") to Rockstar, subject to Seabridge converting its special warrants into shares of Calico.  That sale of the 10% NPI and NPI Put is a condition in the sale agreement with Rockstar.  Therefore, Calico will be recommending to its shareholders to approve the exercise of special warrants by Seabridge Parent and the resulting change in control.

The terms of the proposed sale to Rockstar and the exercise of special warrants by Seabridge and the resulting change in control will be fully described in Calico's information circular to be mailed to its shareholders for its upcoming shareholder meeting.

Terms of the Proposed Sale to Rockstar:

The terms of the proposed sale to Rockstar are set out in the December 3, 2013 Calico news release, which has been SEDAR filed.

The Grassy Mountain Gold Project:

Permitting Status

Calico is proceeding with its environmental data collection component of its permitting process.  The Company has completed key tasks related to surface and ground water resources, wildlife, wetlands and vegetation and is in the process of gathering other work plan-approved information in order to prepare all necessary regulatory applications needed to build the Grassy Mountain Gold Project.  We have already begun to prepare the operating plan, reclamation and closure plan, and certain permit applications, all of which are required under Oregon law to support the project's consolidated permit application.

Calico is very excited about the permitting progress and its strong working relationship with the State of Oregon, Malheur County, and involved federal agencies.  The DOGAMI Division 37 Chemical Process Mining Consolidated Permitting Process is designed to streamline and/or unify the complex environmental permitting process in which we operate today within the mining industry. See the DOGAMI website, in particular (http://www.oregongeology.org/pubs/nr/press-release-2013-03-11.pdf) DOGAMI press release March 11, 2013.

Location of Grassy Mountain Gold Project

The proposed Grassy Mountain Gold Project is located in Malheur County, Oregon, approximately 25 miles south-southwest of Vale, Oregon.  The project area includes patented and unpatented lode mining claims, as well as private land currently under lease for mineral exploration and development.  The proposed underground mine, mill, and ancillary facilities are all located on patented mining claims or private fee land controlled by Calico.  The areas are linked by road on federal land managed by the United States Department of the Interior Bureau of Land Management.  Calico is proposing to construct an underground mine and surface mill complex to develop the Grassy Mountain gold resource.

Technical Report:

The most recently SEDAR filed Technical Report is dated November 29, 2012 and was filed in SEDAR.com on December 4, 2012.  The authors of the Technical Report were Jennifer J. Brown, P.G., SME-RM, Deepak Malhotra, PhD, SME-RM and Zachary Black, E.I.T., SME-RM, all of the engineering firm Gustavson Associates, of Lakewood, Colorado, USA.

Qualified Person

Michael F. McGinnis, Calico's Project Manager/Exploration, is a Qualified Person as defined by National Instrument 43-101 is not independent of Calico, as that term is defined in NI 43-101, and has reviewed and approved the technical contents of this news release.

On behalf of the Board,

Arden (Buck) Morrow, President, CEO and Chairman

Cautionary Statement

This document contains "forward-looking statements" within the meaning of applicable Canadian securities regulations.  All statements other than statements of historical fact herein, including, without limitation, statements regarding exploration plans and other future plans and objectives, are forward-looking statements that involve various risks and uncertainties.  There can be no assurance that such statements will prove to be accurate and future events and actual results could differ materially from those anticipated in such statements.  Important factors that could cause actual results to differ materially from our expectations are disclosed in the Company's documents filed from time to time via SEDAR with the Canadian regulatory agencies to whose policies we are bound.

"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."

SOURCE Calico Resources Corporation



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