Kootenay closes $4.75M Private Placement with Agnico-Eagle Mines Limited

   Kootenay closes $4.75M Private Placement with Agnico-Eagle Mines Limited

  PR Newswire

  VANCOUVER, British Columbia, April 26, 2013

VANCOUVER, British Columbia, April 26, 2013 /PRNewswire/ --

Shares Outstanding: 62,738,850

Kootenay Silver Inc. (TSX VENTURE: KTN ) ("Kootenay" or the "Company")
announces the closing of a $4,750,000 private placement (the "Private
Placement") with Agnico-Eagle Mines Limited ("Agnico-Eagle") previously
announced by the Company on April 23, 2013. An aggregate of 6,250,000 units
(each a "Unit") at a purchase price of $0.76 per Unit were issued to
Agnico-Eagle pursuant to the Private Placement, with each Unit consisting of
one common share in the capital of the Company (each a "Common Share") and
one-half of one transferrable common share purchase warrant (each whole
warrant, a "Warrant"). Each Warrant entitles Agnico-Eagle to acquire one
Common Share at an exercise price of $1.08 until April 26, 2015. All of the
securities issued pursuant to the Private Placement are subject to a hold
period until August 27, 2013.

As a result of its participation in the Private Placement, Agnico-Eagle now
owns 9.96% of Kootenay's issued and outstanding Common Shares on a non-diluted
basis (14.23% if Agnico-Eagle exercises all of the Warrants). Agnico-Eagle
also has a participation right until April 26, 2015 pursuant to which,
provided that Agnico-Eagle owns at least five percent of the then issued and
outstanding Common Shares of Kootenay (taking into account convertible
securities owned by Agnico-Eagle), it has the right to participate in certain
equity offerings of the Company on the same terms as other participants in
such offerings in order to maintain its pro-rata ownership interest in the
Company.

The securities being offered have not been, nor will they be registered under
the United States Securities Act of 1933, as amended, or state securities laws
and may not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons absent U.S. federal and state registration
or an applicable exemption from the U.S. registration requirements. This
release does not constitute an offer for sale of securities in the United
States.

ABOUT KOOTENAY

Kootenay is actively developing mineral projects in the Sierra Madre Region of
Mexico and in British Columbia, Canada. Its flagship property is the former
producing Promontorio Silver mine in Sonora State, Mexico. Kootenay's
objective is to develop near term discoveries and long-term sustainable
growth. Its management and technical team are proven professionals with
extensive international experience in all aspects of mineral exploration,
operations and venture capital markets. Multiple, ongoing J/V partnerships in
Mexico and Canada maximize potential for additional, new discoveries while
maintaining minimal share dilution.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements : The information in this news release has been
prepared as at April 26 2013. Certain statements in this news release,
referred to herein as "forward-looking statements", constitute
"forward-looking statements" under the provisions of Canadian securities laws.
These statements can be identified by the use of words such as "expected",
"may", "will" or similar terms.

Forward-looking statements are necessarily based upon a number of factors and
assumptions that, while considered reasonable by Kootenay as of the date of
such statements, are inherently subject to significant business, economic and
competitive uncertainties and contingencies. Many factors, known and unknown,
could cause actual results to be materially different from those expressed or
implied by such forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date made. Except as otherwise required by law, Kootenay expressly disclaims
any obligation or undertaking to release publicly any updates or revisions to
any such statements to reflect any change in Kootenay's expectations or any
change in events, conditions or circumstances on which any such statement is
based.

For further information: James McDonald, CEO and President at +1-403-238-6986
Investor Relations at 604-601-5652; +1-888-601-5650 or visit:
http://www.kootenaysilver.com (KTN.)
 
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