Royal Road Minerals Limited
TSX VENTURE : RYR

Royal Road Minerals Limited

April 21, 2015 09:23 ET

Royal Road Minerals Announces Amendment of Option Agreement Covering the Gomec, Ugur Tepe and Ispir Gold and Copper Properties; Turkey

Addition of favorable new transaction terms and improvement of earn-in conditions

TORONTO, ONTARIO--(Marketwired - April 21, 2015) - Royal Road Minerals Limited (TSX VENTURE:RYR) ("Royal Road Minerals" or the "Company") a gold and copper focused mineral exploration and development company is pleased to announce amendments to the terms of its option agreement covering the Gömeç, Gökçeada and Ispir licenses (the "Option Licenses") in Turkey. The amendments provide for certain changes to the earn-in provisions in connection with the Option Licenses and new provisions regarding the sale of certain of these licenses.

On April 17, 2015, the Company entered into an amendment protocol, which amends the terms of the option agreement (the "Option Agreement") dated September 25, 2014, between the Company; Tigris Eurasia Madencilik Sanayi ve. Ticaret Limited Şirketi ("RRM Turkey"), the Company's wholly owned subsidiary which carries on operations in Turkey; Merih Madencilik Sanayi ve Ticaret Anonim Şirketi ("Merih"); and Oremine Madencilik Sanayi ve Ticaret A.Ş. ("Oremine Resources") and Özgün Çökük. Under the amended terms of the Option Agreement, Özgün Çökük, the sole shareholder of Merih and Oremine Resources (collectively, the "JV Companies") granted an option to the Company and RRM Turkey to acquire up to a 50% equity interest in each of the JV Companies and thereby acquire a 50% indirect interest in a gold and copper project (the "Uğur Tepe Project") in the Çanakkale Province in northwestern Turkey; an epithermal-porphyry gold project (the "Gömeç Project") located in Balikesir Province in the western part of Turkey and an exploration license near the town of İspir in the Erzurum Province in the Eastern Anatolia region of Turkey.

In accordance with the amended terms of the Option Agreement, in order to earn this interest, the Company and RRM Turkey must spend an aggregate of US$2,000,000 on exploration and development work at these projects to earn a 20% interest in the JV Companies and a further US$2,000,000 of such expenditures to earn an additional 30% interest in the JV Companies, in each case, before December 31, 2016. In addition, on or before December 31, 2016, the Company or RRM Turkey, as the case may be, must pay an amount equal to US$3,000,000 to Özgün Çökük as consideration for his waiver or agreement not to participate in the capital increase or in connection with any applicable share transfer transactions, which would result in the Company or RRM Turkey acquiring a 50% shareholding in each of the JV Companies.

Under the terms of the amended Option Agreement, the parties have also agreed that, in the event that a JV Company transfers certain of the Option Licenses prior to such time as the Company or RRM Turkey has acquired at least a 20% interest therein, such JV Company shall be obligated to use 20% of the proceeds from such sale to purchase shares of the Company in a private placement transaction. Once the Company has acquired at least a 20% interest in the JV Companies, any proceeds from any such transfer would be distributed to the shareholders of the JV Companies pro-rata, based on their respective equity interest.

Up until April 20, 2015 the Company had spent approximately $USD 800,000 on exploration expenditures on the Option Licenses.

"The ability to receive 20% of sales proceeds as a private placement on license transactions before we have earned our equity ownership is a meaningful addition to the agreement and testament to the great partnership we have in Turkey" said Tim Coughlin, Royal Road's President and CEO. "The concession on earn-in terms also helps us manage our capital requirements until the end of next year. The next decision gate on the Option Agreement will follow the drilling campaign at Gömeç which is expected to be underway by June of this year."

The information in this news release was compiled, reviewed and verified by Dr. Tim Coughlin, BSc (Geology), MSc (Exploration and Mining), PhD (Structural Geology), FAusIMM, President and CEO of Royal Road Minerals Ltd and a qualified person as defined by National Instrument 43-101. Royal Road Minerals employees are instructed to follow standard operating and quality assurance procedures intended to ensure that all sampling techniques and sample results meet international reporting standards. All assay work for released results are carried out by ALS-Chemex analytical laboratory in Izmir, Turkey. More information can be found on Royal Road Minerals web site at www.royalroadminerals.com

About Royal Road Minerals:

Royal Road Minerals is a gold and copper focused exploration and development company. The Company has projects in Western and Southeast Turkey. In the West the Company is advancing gold and copper projects under an earn-in agreement whereas in the East it is conducting early-stage exploration in a remote, under-explored and highly prospective gold and copper mineralized magmatic belt.

Cautionary statement:

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. 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 and include statements regarding the Option Agreement. 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, mine site planning and development, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal prices, permitting and licensing 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.

Contact Information

  • Royal Road Minerals Limited
    Donna Pugsley
    Investor Relations Manager
    +44 (0)1534 887166
    +44 (0)7797 742800
    info@royalroadminerals.com