Signs New JV Agreement on Golden Promise Gold Project
posted on Apr 09, 2009 05:39AM
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|April 9, 2009|
Paragon Signs New JV Agreement on Golden Promise Gold Project
Paragon to receive 2,655,000 shares of Crosshair plus up to $3.0 million in carried exploration expenditures
|VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 9, 2009) - Paragon Minerals Corporation (TSX VENTURE:PGR)("Paragon") is pleased to announce that it has entered into a new joint venture agreement with Crosshair Exploration & Mining Ltd. (TSX:CXX)(NYSE Alternext US:CXZ) ("Crosshair") whereby Crosshair can acquire up to a 70% interest in the Golden Promise Gold Project located in central Newfoundland, Canada. The new agreement will result in the termination of the original property option earn-in agreement with Crosshair and the property sale agreement entered into last year.
"We are very pleased to renew our partnership with Crosshair on the Golden Promise Gold Project" said Michael Vande Guchte, President and CEO of Paragon. "Their work to date has demonstrated high-grade gold vein systems at Golden Promise that remain open along strike and to depth. We look forward to an aggressive drilling and bulk sampling campaign on the property with the objective of increasing the current NI43-101 compliant gold resource".
Under the terms of the new joint venture agreement Crosshair will issue to Paragon, 2,655,000 of its common shares to earn a 60% interest in the Golden Promise Gold Project. Crosshair will provide Paragon with a $2.0 million carried interest in exploration expenditure to be completed prior to May 2013. Crosshair can extend this time frame by one year upon issuing a further 250,000 common shares to Paragon.
On completion of the initial $2.0 million in exploration expenditures, Crosshair can elect to earn an additional 10% interest (to 70%) in the Golden Promise Gold Project by providing Paragon with an additional $1.0 million carried interest in exploration expenditures within a one year period. Crosshair can extend this time frame by one year upon issuing a further 100,000 common shares to Paragon. If Crosshair does not complete the additional exploration expenditures, it can purchase the 10% interest by paying Paragon the difference between the incurred additional exploration expenditures and the $1.0 million or retain a 60% interest.
Closing is expected to be completed no later than May 8, 2009 and is conditional on receiving regulatory approval of the agreement.
Paragon Minerals Corporation is a Canadian-based mineral exploration company listed on the TSX Venture Exchange. The Company and its exploration partners are focused on gold and base metal exploration projects in the Province of Newfoundland and Labrador. Paragon's other key assets include the 100%-controlled South Tally Pond VMS project and JBP Linear gold project. For additional information on Paragon's properties and its joint venture partners, please visit the Company website at www.paragonminerals.com.
PARAGON MINERALS CORPORATION
Michael J. Vande Guchte, President & CEO
Qualified Person - David A. Copeland, M.Sc., P.Geo is Paragon's Qualified Person as defined by NI 43-101 with respect to this release. Mr. Copeland has reviewed and approved the contents of this news release.