Rye Patch and Coeur Reach Settlement on LH Claim Legal Dispute
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 06/25/13 -- Rye Patch
Gold Corp (TSX VENTURE:RPM)(OTCQX:RPMGF)(FRANKFURT:5TN) (the
"Company" or "Rye Patch") is pleased to announce that it has settled
the legal dispute between Rye Patch and its wholly-owned subsidiary,
Rye Patch Gold US Inc. (collectively "Rye Patch"), and Coeur Mining
Inc.'s wholly-owned subsidiary, Coeur Rochester Inc. ("Coeur"). Rye
Patch and Coeur engaged in the legal dispute over title to certain LH
and OG unpatented lode mining claims covering portions of the
Rochester and Packard mine areas. In settlement of the legal dispute,
Rye Patch will convey all of the disputed LH and OG unpatented lode
mining claims (comprising 386 of the 410 LH claims and all three OG
claims) to Coeur in return for the following:
-- A cash payment to Rye Patch of Ten Million Dollars ($10,000,000);
-- A net smelter returns production royalty equal to 3.4% of the gross
revenue, less refining costs, of gold and silver produced and sold from
the Rochester Mine covering 39.4 million ounces of silver equivalent
(the "NSR"); and
-- At Rye Patch's election, Coeur will transfer to Rye Patch the Blue Bird
patented lode mining claim located adjacent to Lincoln Hill, about two
miles west of Rochester.
William C. Howald, the Company's President and Chief Executive
Officer, stated, "I've travelled across Canada, Europe and the United
States, and Rye Patch shareholders have expressed their appreciation
for the Company's ability to identify and act on significant
opportunities. While we believe our legal position is strong, it is
ultimately in the Company's best interests not to continue with a
potentially lengthy and protracted lawsuit at the expense of our core
business operations. This settlement allows Rye Patch to move forward
and focus on its core business of finding and developing gold and
silver resources in Nevada, while providing non-dilutive cash and a
royalty stream to the Company to identify the next value-adding
opportunity. We are eager to develop our remaining gold and silver
assets along the Oreana trend that could contribute upside to our new
partners at Coeur or others looking to expand their presence in the
Oreana trend. The Company has significant expansion potential along
the Oreana trend and tremendous upside potential in our Cortez
The NSR will be effective as of January 1, 2014 and will terminate
after 39.4 million silver equivalent ounces have been produced and
sold from the Rochester Mine. Silver equivalent will be determined by
converting sales of gold to the equivalent number of ounces of silver
based on actual prices of gold and silver at the time of sale. The
NSR is non-assignable except to an affiliate controlled by Rye Patch;
however, from and after January 1, 2014, the NSR may be assigned (i)
in a single-asset transaction, (ii) for cash consideration, (iii)
upon at least 30 days' advance notice to CRI and (iv) to a company
whose principal business is the acquisition, holding or management of
precious metals production royalties and streams. CRI shall have a
right of first refusal to acquire the NSR on the same terms as any
proposed permitted sale of the NSR by Rye Patch.
The settlement dismisses the legal dispute among the parties lodged
in the Nevada Sixth District Court in 2011. Mr. Howald stated, "I
would also like to take this opportunity to thank our Canadian
counsel, Koffman Kalef LLP, led by Bernard Poznanski, and our U.S.
counsel, Erwin & Thompson LLP, led by Tom Erwin and Frank Thompson,
for their wise and determined advocacy on behalf of Rye Patch
throughout the litigation proceedings and settlement negotiations."
The Company is a Tier 1, Nevada-focused and discovery-driven company
seeking to build a sizeable inventory of gold and silver resource
assets in the mining friendly state of Nevada, USA. The Company's
seasoned management team is engaged in the acquisition, exploration,
and development of quality resource-based gold and silver projects.
Rye Patch Gold US Inc. controls over 75 square kilometres (30 sq.
miles) along the Oreana trend located in west-central Nevada, and is
developing gold and silver resources along this emerging trend. In
east central Nevada, Rye Patch Gold US Inc. is exploring 66 square
kilometres along the prolific Cortez trend near Barrick's new gold
discovery. The Company has established gold and silver resource
milestones and time frames in order to build a premier resource
development company. For more information about the Company, please
visit our website at www.ryepatchgold.com.
On behalf of the Board of Directors
William C. (Bill) Howald, CEO & President, Rye Patch Gold Corp.
This news release contains forward-looking statements, which address
future events and conditions, which are subject to various risks and
uncertainties. The Company's actual results, programs and financial
position could differ materially from those anticipated in such
forward-looking statements as a result of numerous factors, some of
which may be beyond the Company's control. These factors include: the
availability of funds, the financial position of Rye Patch to pursue
legal undertakings; the timing and content of work programs; results
of exploration activities and development of mineral properties, the
interpretation of drilling results and other geological data, the
uncertainties of resource and reserve estimations, receipt and
security of mineral property titles; project cost overruns or
unanticipated costs and expenses, fluctuations in metal prices;
currency fluctuations; and general market and industry conditions.
Litigation is inherently uncertain and factors that could cause
actual results to differ materially from those in forward-looking
statements include unexpected judicial findings of fact, previously
unknown facts arising, and decisions which depart from past legal
precedent and similar events.
Forward-looking statements are based on the expectations and opinions
of the Company's management on the date the statements are made. The
assumptions used in the preparation of such statements, although
considered reasonable at the time of preparation, may prove to be
imprecise and, as such, undue reliance should not be placed on
Neither 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.
Rye Patch Gold Corp.
(604) 638-1589 (FAX)
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