WestMountain Gold Signs Letter of Intent to Purchase Corvus Gold’s Remaining
Interest in Terra Gold Project Joint Venture
DENVER -- February 20, 2013
WestMountain Gold, Inc. (“WestMountain”) (OTCQB: WMTN), an emerging mineral
exploration and development company, today announced it has signed a letter of
intent (LOI) to acquire Corvus Gold’s remaining interest in the Terra Project
in Alaska. Upon closing, this transaction will give WestMountain 100%
ownership in the project, which the Company expects to yield greater than
1,000,000 ounces of gold over the life of the mine.
Under terms of the proposed transaction, which is subject to customary closing
conditions, WestMountain will acquire Corvus’ interest for $6.0 million in
cash and 750,000 shares of restricted common stock. The closing will occur in
stages with WestMountain making the following milestone payments:
*April 15, 2013: $3.0 million in cash and 750,000 shares of common stock
bearing a two-year hold period.
*July 15, 2013: $2.0 million in cash.
*April 15, 2014: $1.0 million in cash.
*Going forward, Corvus will be paid sliding scale NSR royalty of 0.5% to 3%
on precious metals (3% above $1,500 gold price) and a flat 2% NSR royalty
on all base metals. Also as part of the transaction, WestMountain will
complete its vesting requirements with International Tower Hill Mines Ltd.
with a payment of $150,000 in cash and 250,000 shares of West Mountain
“The Terra Project is WestMountain’s flagship asset, so we are extremely
pleased with this agreement to acquire full ownership over the next 14
months,” said Greg Schifrin, President and CEO. “Our drilling program at Terra
has returned increasingly positive results and we’re optimistic about
prospects for steadily increasing our resource base through continued drilling
activities. At the same time, we expect to steadily increase gold and silver
production at our pilot gold mill.”
Schifrin noted two additional positive aspects of the pending transaction,
which supersedes a prior earn-in agreement between WestMountain and Corvus.
“Our previous agreement called for Corvus to receive 49% of production during
the earn-in period and up to a 5% royalty thereafter,” he said. “Our new
agreement eliminates the 49% production payout and reduces the royalty to a
maximum of 3% -- a solid value proposition for our stockholders given our
belief that the project is expected to yield greater than 1,000,000 ounces of
gold over the life of the mine.”
About WestMountain Gold, Inc.
WestMountain Gold, Inc. (OTCQB: WMTN) is an exploration and development
company that explores, acquires, and develops advanced stage properties. The
Company has a high-grade gold system in the resource definition phase with
168,000 ounces of inferred gold, which in total offers potential of greater
than 1,000,000 ounces that is owned by the Company’s wholly owned subsidiary,
Terra Gold Corporation (“TGC”). The WestMountain property consists of 344
Alaska state mining claims covering 223 square kilometers. All government
permits and reclamation plans for continued exploration through 2014 were
renewed in 2010. TGC is a joint venture partner of Corvus Gold, Inc.
(“Corvus”) on this project. Additional details are available at
Safe Harbor Statement Some statements contained in this news release are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, and, therefore, involve uncertainties or risks that could
cause actual results to differ materially. These statements may contain words
such as "desires," "believes," "anticipates," "plans," "expects," "intends,"
"estimates" or similar expressions. These statements are not guarantees of the
Company's future performance and are subject to risks, uncertainties and other
important factors that could cause its actual performance or achievements to
differ materially from those expressed or implied by these forward-looking
statements. Such statements include, but are not limited to, the vast
potential of the Terra Project; expectation to produce greater than 1,000,000
ounces of gold over the life of the mine; the ability of the Company to raise
the capital necessary to close the proposed transaction; continued exploratory
drilling at the Terra project; and the ability of the mill to process 40
tonnes per day. Additional information regarding factors that could cause
results to differ materially from management's expectations is found in the
Company’s SEC filings. The Company intends that the forward-looking statements
contained herein be subject to the above-mentioned statutory safe harbors.
Investors are cautioned not to rely on forward-looking statements. The Company
disclaims any obligation to update forward-looking statements.
WestMountain Gold, Inc.
Chief Executive Officer
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