Independent Firms Recommend Contango ORE Merger to Silver Explorer's Shareholders

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1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Two prominent independent proxy advisory firms, including Institutional Shareholder Services (ISS), have endorsed the special resolution to approve Dolly Varden Silver Corp.'s (DV:TSX.V; DVS:NYSEA; DVQ:FSE) court-sanctioned plan of arrangement with Contango ORE Inc., according to a February 9 release.

This endorsement supports the merger between Dolly Varden and Contango initially signed in December. The crucial shareholder meeting to deliberate and vote on the Arrangement is set for March 17, 2026, at 10 a.m. PT, hosted at Stikeman Elliott LLP, 666 Burrard Street, in Vancouver, British Columbia.

ISS has officially recommended that Dolly Varden's shareholders vote in favor of the Arrangement Resolution.

"We are pleased that leading independent proxy advisory firms have recognized the strategic merits of this transaction," President and Chief Executive Officer Shawn Khunkhun said. "Their analysis highlights the compelling industrial logic of combining Dolly Varden and Contango, including the opportunity to create a stronger, better capitalized company with increased scale, liquidity and exposure to high-quality assets. Importantly, the proposed merger of equals allows our shareholders to retain meaningful ownership in the combined company and participate in the long-term upside of a diversified precious metals platform."

Key aspects of the arrangement include a fixed exchange ratio, where each Dolly Varden common share will be exchanged for 0.1652 of a Contango share, or, for eligible holders who validly elect, 0.1652 of an exchangeable share. The arrangement underwent a thorough evaluation and received unanimous support from Dolly Varden's Special Committee and Board of Directors. Additionally, fairness opinions were provided by financial advisors, specifically Raymond James Ltd. and Haywood Securities Inc. Moreover, directors, officers of Dolly Varden, and certain significant shareholders, who collectively represent about 22% of the issued and outstanding Dolly Varden shares as of the Arrangement Agreement date, have agreed to vote in favor of the arrangement.

Vote Details

Dolly Varden is urging its shareholders to cast their votes in favor of the Arrangement Resolution before the proxy voting deadline at 10 a.m. PT on Friday, March 13, 2026. The Board has recommended a vote for the resolution, emphasizing the importance of voting early to ensure timely submission. Registered shareholders are advised to vote by proxy using the methods outlined in their proxy forms, including internet or telephone options. Beneficial shareholders should adhere to the instructions provided by their intermediaries, which may include options for telephone and internet voting through a Broadridge voting instruction form.

Additionally, registered shareholders who qualify as eligible holders and desire to receive exchangeable shares instead of Contango shares must promptly submit a completed Letter of Transmittal and Election Form, which is included in the Meeting materials and available on SEDAR+. If these forms are not properly completed and submitted by the yet-to-be-announced election deadline, shareholders will automatically receive Contango shares for any Dolly Varden shares for which no valid election was made.

Dolly Varden said it will issue a news release announcing the election deadline at least two business days in advance, highlighting the urgency for shareholders to act swiftly.

For any questions or assistance with voting, shareholders can reach out to Laurel Hill Advisory Group, which Dolly Varden has engaged to help with shareholder communications and proxy solicitation. Shareholders can contact Laurel Hill toll-free in North America at 1-877-452-7184, collect outside North America at 1-416-304-0211, by texting "INFO" to 1-877-452-7184, or via email at assistance@laurelhill.com, Dolly Varden said.

The Board of Directors of Dolly Varden's unanimous endorsement of the arrangement resolution urged shareholders to vote in favor for multiple reasons. They highlighted the arrangement's flexibility to consider a superior proposal if it emerges, aligning with the terms of the arrangement agreement. The board also points to the potential for shareholders to gain from the future value of the merged entity and believes that the process has been equitable, ensuring fair treatment for all stakeholders involved.

Further, the Board is confident in securing the necessary court and regulatory approvals to finalize the deal. They note the advantage of having no financing condition, which smooths the path to completion, pending the fulfillment of other conditions and approvals. The anticipated continuity of leadership, with certain directors and senior executives expected to hold positions in the new organization, is also seen as a positive aspect of the arrangement.

A Consistent Trend of High-Grade Discoveries

Haywood Capital Markets issued a preview note on January 27, revising its financial projections for precious metals stocks. The firm increased its gold price forecasts for both the short and long term, adjusted its foreign exchange rate assumptions, and lowered its NAV multiple from 0.75x to 0.70x. These adjustments led Haywood to raise its target price for Dolly Varden's shares to CA$14.00 from CA$11.25, maintaining a Buy rating on the stock.

In a recent update on February 4, Jeff Valks, a senior analyst at The Gold Advisor, offered a compelling analysis of Dolly Varden's recent assay results, describing them as "wide, weighty, and hard to ignore." Valks elaborated on the results, noting their complex, multi-layered nature, which goes beyond just a single significant discovery. He detailed how the company's 2025 drilling program at the Homestake Silver and Homestake Main sites, which included 29 and two holes respectively, not only filled in gaps but also extended the high-grade gold and silver trend to the north.

Valks drew particular attention to "the headline intercept" which featured 48.49 meters grading 4.66 grams per tonne (g/t) gold, including segments of 1.01 meters at 52.15 g/t gold and 306 g/t silver, and 1.87 meters at 46.55 g/t gold and 298 g/t silver. This drilling campaign successfully expanded the mineralized zones both laterally and at depth, with step-out and down-dip drilling revealing a consistent pattern of broad mineralized envelopes punctuated by sharp, high-grade veins.

He emphasized that these findings are not isolated events but part of a consistent trend of high-grade discoveries at Homestake, supported by robust financing and an expanded drilling program across the Kitsault Valley Project. The results underscore the deposit’s potential, which remains open along its plunge and depth, and demonstrate continuity over an increasing strike length. Valks praised the deposit's substantial nature, stating, "The combination of width, grade, and repeatability at Homestake Silver continues to strengthen the case that this is a deposit with real heft, not just highlight reels."

Valks also reminded readers of the strategic implications of Dolly Varden's upcoming merger with Cantango Ore, noting his own long position in the stock and referencing Gold Advisor Founder Jeff Clark’s continued full-weighting in the company.

On February 25, Peter Krauth of The Silver Advisor listed the company among those that offer the "best relative value right now."

"In my view, they are worthy of research and consideration," Krauth wrote.

The Catalyst: A Precious Metal Buying Opportunity?

Nearly 10 days following the initiation of military actions by the United States and Israel against Iran, the prices of gold and silver have unexpectedly declined, contrary to the usual market behavior during significant geopolitical upheavals, according to a report by Vneet Dubey for Money Control on March 9.

On February 28, the day the conflict erupted, gold was priced at approximately US$5,416 per ounce. Since the escalation of hostilities into other Gulf nations, the price of gold has decreased by about 5.7%.

Silver has experienced an even more pronounced decline, with nearly a 9% drop in just over a week. Typically, gold and silver are considered safe havens during times of war and geopolitical tension, yet despite the ongoing conflicts in West Asia and the existing strife between Russia and Ukraine, both metals have seen their values decrease.

The unexpected behavior of gold and silver prices can be attributed to several factors, Dubey wrote. The strengthening of the U.S. dollar and changing expectations regarding the Federal Reserve’s interest rate decisions have dampened investor enthusiasm for these precious metals. During conflicts, particularly in oil-rich regions like West Asia, oil prices tend to rise, which boosts global demand for the dollar since oil transactions are predominantly dollar-denominated.

According to the report, market analysts, including Satish Dondapati, a Fund Manager at Kotak Mutual Fund, suggest that the initial price surge following the conflict's onset led some investors to take profits, contributing to the subsequent price corrections. He noted, "Gold and silver had rallied significantly over the past few months, so when prices jumped after the news, some investors booked profits, which led to a correction rather than a sustained sharp rise."

Additionally, the broader availability of safe-haven assets such as US treasuries and other dollar-denominated assets has dispersed investor interest across various options, moderating the price increases in gold and silver.

On Friday, gold and silver are experienced slight increases following a disappointing U.S. jobs report for February, according to Jim Wyckoff of Kitco News on March 6. The report, which revealed a significant shortfall in non-farm payrolls, has contributed to some safe-haven buying amid ongoing war tensions in Iran, heightening risk aversion across global markets.

The U.S. labor market saw a reduction of 92,000 non-farm payroll jobs in February, a stark contrast to the robust gain of 126,000 jobs in January, which was also revised downward, Wyckoff noted. This downturn pushed the unemployment rate up to 4.4%, surpassing the anticipated 4.3%. This development is likely to bolster the arguments of U.S. monetary policy doves, who are advocating for earlier interest rate cuts.

In related international news, the ongoing conflict in the Middle East is impacting gold trading dynamics in Dubai. The war has led to grounded flights and logistical challenges, making it difficult for suppliers to transport bullion from this crucial market hub.

Consequently, traders in Dubai are now offering gold at discounts up to US$30 an ounce below the global benchmark price in London. The high costs of shipping and insurance have prompted many buyers to hold off on placing new orders. This disruption is particularly affecting gold buyers in India, where demand is currently subdued and stock levels are high due to a significant influx of imports in January.

Ownership and Share Structure¹

Institutional investors own 52% of the company. Among them, Hecla Mining Co. (HL:NYSE) holds 13%, Fury Gold Mines Ltd. (FURY-T) owns 12%, and Eric Sprott holds 9%. The remainder is held by retail investors.

Dolly Varden has 90.92 million outstanding shares and its market cap is CA$543.68 million. Its 52-week range is CA$3.21–CA$8.09 per share.