DENVER, March 6 /PRNewswire-FirstCall/ -- ROYAL GOLD, INC.
(Nasdaq: RGLD; TSX: RGL), the leading precious metals royalty company,
announced that the conversion of all of its 7.25% mandatory convertible
preferred stock ("Preferred Stock") into shares of Royal Gold common stock
will occur on March 10, 2008. A Notice of Conversion was previously mailed to
registered holders of the Preferred Stock on January 25, 2008.
Based on the average closing price of $29.78 per common share on the
Nasdaq Global Select Market, over the 20-consecutive trading day period ending
on March 5, 2008, each outstanding share of Preferred Stock will automatically
convert into 3.4589 shares of common stock. No fractional shares of Royal
Gold's common stock will be issued as a result of the conversion. Holders of
fractional shares will receive cash. The Company will issue approximately
3,978,000 shares of its common stock upon the conversion. In addition, Royal
Gold will pay the final cash dividend of $0.5035 per share to all holders of
the Preferred Stock on March 10, 2008. The Preferred Stock ceased trading on
the Nasdaq Global Select Market at the close of business on March 5, 2008, in
order to facilitate the conversion.
For the third quarter of fiscal 2008, the Company expects to record an
adjustment to earnings available to common stockholders for dividends related
to the Preferred Stock of $1.6 million, or $0.05 per common share, in addition
to a non-cash "deemed dividend" charge of approximately $2.0 million, or $0.06
per common share. Other than the additional common stock that will be issued
and outstanding, there will be no further impact on the Company's financial
results associated with the Preferred Stock for any period following the
Company's third fiscal quarter. After the conversion, Royal Gold will have
approximately 33.9 million shares of common stock outstanding.
Tony Jensen, President and CEO, commented, "Converting the preferred
shares to common stock streamlines our capital structure and reduces our cost
of capital through the elimination of the 7.25% dividend payment."
Royal Gold is a precious metals royalty company engaged in the acquisition
and management of precious metal royalty interests. Royal Gold is
publicly-traded on the NASDAQ Global Select Market under the symbol "RGLD,"
and on the Toronto Stock Exchange under the symbol "RGL." The Company's web
page is located at http://www.royalgold.com.
Cautionary "Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995: With the exception of historical matters, the matters
discussed in this press release are forward-looking statements that involve
risks and uncertainties that could cause actual results to differ materially
from the forward-looking statements contained herein. Such forward-looking
statements include statements on the streamlining of the Company's capital
structure and reduction of the cost of capital. Factors that could cause
actual results to differ materially from projections include, among others,
the timing and size of the Company's stock repurchases, precious metals
prices, decisions and activities of the operator of the various properties,
unanticipated grade, geological, metallurgical, processing or other problems
the operator may encounter, changes in project parameters as plans continue to
be refined, economic and market conditions, as well as other factors described
elsewhere in this press release and in our Annual Report on Form 10-K, and
other filings with the Securities and Exchange Commission. Most of these
factors are beyond the Company's ability to predict or control. The Company
disclaims any obligation to update any forward-looking statement made herein.
Readers are cautioned not to put undue reliance on forward-looking statements.
SOURCE Royal Gold, Inc.
Mar 06, 2008