01/23/2013 07:21 EST | Updated 03/25/2013 05:12 EDT

Rogue Iron lines up AuRico Gold as strategic partner of proposed gold spinoff

VANCOUVER - Rogue Iron Ore Corp. (TSXV:RRS) says a its new Rapier Gold spinoff will form a strategic alliance with AuRico Gold Inc. (AUQ), which will become a large minority shareholder and have right of first refusal on certain assets.

Rogue has scheduled a Feb. 22 vote on the revised plan for the Rapier Gold Inc. spinoff, which had been approved in December before the latest developments.

Under the agreement announced Wednesday, AuRico would have a 17 per cent interest in Rapier Gold plus other rights in return for an investment of at least $1.25 million.

AuRico would pay 30 cents each for units comprised one share and a half warrant, exercisable within two years. AuRico would also have the right to maintain its proportionate share of Rapier Gold's equity and a right of first refusal covering any joint venture on the Pen gold property.

In announcing the AuRico allian, Rogue Iron said it will seek approval for changes to several key elements of the original plan for Rapier Gold.

Among other things, Rogue shareholders would receive one share in the new gold company for each 4.49 shares they own, rather one Rapier share for each 4.04 shares they own.

In addition, Rapier will be relieved of a minimum financing requirement — although Rogue Iron says the spinoff still intends to raise between $3 million tnad $4 million as part of the transaction.

Rogue Iron's shareholders gave near-unanimous approval for the Rapier Gold spinoff at a meeting on Dec. 10, but that plan hasn't been completed.