/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED
STATES/
VANCOUVER, March 29, 2016 /CNW/ - Kootenay Silver Inc.
(TSX-V: KTN) ("Kootenay Silver") and Northair Silver Corp. (TSX-V:
INM) ("Northair") Kootenay Silver is pleased to announce that
it has signed an agreement with Coeur Capital, Inc. ("Coeur") to
acquire (the "Acquisition") its 2.5% net smelter return royalty
("NSR") on future production from Northair Silver Corp.'s
("Northair") La Cigarra project, located in Chihuahua,
Mexico. The Acquisition is subject to the acceptance of the
TSX Venture Exchange.
Kootenay Silver President and CEO James
McDonald stated "We are very pleased to have the opportunity
to consolidate the ownership of the royalty at this time.
Given our belief in La Cigarra's silver resources and the potential
for additional discoveries the opportunity to repurchase the
royalty is beneficial to the project."
Terms of the Agreement:
Under the terms of the agreement, Kootenay will pay to Coeur
US$250,000 in cash upon signing
followed by a second cash payment of US$250,000 to be made on April 19, 2016 (the "Closing Date"). In
addition, Kootenay Silver will issue to Coeur on the Closing Date
such number of common shares (the "Shares") of Kootenay Silver as
is equal to US$2,000,000 at a share
price of Cdn$0.275 per share which
will result in the issuance of 9,629,091 common shares of Kootenay
Silver. The Shares issued in connection with the Acquisition
will be subject to a statutory hold period of four months plus one
day from the closing of the Acquisition under applicable Canadian
securities laws. Upon issuance of the Shares, Coeur will hold an
aggregate of 9,629,091 common shares of Kootenay Silver. The
completion of the Acquisition is not subject to the completion of
Kootenay Silver's proposed acquisition of all of the issued and
outstanding shares of Northair to be completed by way of a
statutory plan of arrangement (the "Arrangement") as announced on
January 13, 2016 (see press releases
dated January 13, 2016 and
February 8, 2016).
Support Agreement:
In addition, Coeur has entered into an agreement with Kootenay
Silver to vote all of the shares that it holds in Northair in
favour of and in support of the Arrangement between Kootenay Silver
and Northair. This represents approximately 13.55 % of the
outstanding Northair shares.
Northair President and CEO Andrea
Zaradic stated "We are very pleased that Kootenay Silver and
Coeur were able to agree to the terms of the Acquisition and that
Coeur supports our proposed amalgamation with Kootenay
Silver."
This news release does not constitute an offer to sell or a
solicitation of an offer of securities in the United States. The securities issuable in
the transaction have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "U.S.
Securities Act") or any state securities laws and may not be
offered within the United States
or to U.S. Persons unless exemptions from such registration
requirements are available.
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.
Qualified
Persons
The Kootenay Silver technical information in this news release
has been prepared in accordance with the Canadian regulatory
requirements set out in NI 43-101 and reviewed on behalf Kootenay
Silver by James McDonald, P.Geo,
President, CEO & Director for Kootenay, a Qualified Person.
The Northair disclosure of a scientific or technical nature
contained in this news release was reviewed by David Ernst, a professional geologist and
vice-president of exploration of Northair, who is a Qualified
Person in accordance with the requirements of NI 43-101.
About Kootenay
Kootenay Silver Inc. is an exploration company actively
engaged in the discovery and development of mineral projects in the
Sierra Madre Region of Mexico and
in British Columbia, Canada. The
Company's top priority is the advancement of precious metals
projects contained within its Promontorio Mineral Belt in
Sonora, Mexico. This includes its
La Negra high-grade silver discovery and its Promontorio Silver
Resource. Kootenay's core objective is to develop near term
discoveries and long-term sustainable growth. Management comprises
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.
About Northair
Northair is focused on advancing its flagship La Cigarra
silver project located in the state of
Chihuahua, Mexico, 26 kilometres from the historic silver
mining city of Parral. The property boasts nearby power, good road
access, gentle topography, established infrastructure and currently
hosts a NI 43-101 Resource estimate of 51.47 million ounces of
silver in the Measured & Indicated categories grading 86.3 g/t
silver and 11.46 million ounces of silver in the Inferred category
grading 80 g/t silver. The mineralized system at La Cigarra has
been traced over 6.5 kilometres and is defined at surface as a
silver soil anomaly and by numerous historic mine workings. The La
Cigarra silver deposit is open along strike and at depth and is
approximately 25km north, and along strike of Grupo Mexico's
Santa Barbara mine and
Minera Frisco's San Francisco del Oro mine.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
The information in this news release has been prepared as at
March 28, 2016. Certain statements in
this news release, referred to herein as "forward-looking
statements", constitute "forward-looking statements" under the
provisions of Canadian provincial 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 Silver and Northair as of the date of such statements, are
inherently subject to significant business, economic and
competitive uncertainties and contingencies. Forward-looking
statements in this press release relate to, among other things:
anticipated benefits of the Transaction to Kootenay Silver and
Northair and their respective securityholders; the pro rata
shareholdings of the current shareholders of Northair in Kootenay
Silver; the timing and receipt of required securityholder, court,
stock exchange and regulatory approvals for the Transaction; the
ability of Kootenay Silver and Northair to satisfy the other
conditions to, and to complete, the Transaction; the anticipated
timing of the mailing of the information circular regarding the
Transaction; the closing of the Transaction; analyst coverage,
liquidity and access to capital markets of Kootenay Silver; length
of the current market cycle and the requirements for an issuer to
survive the current market cycle and future growth potential for
Kootenay Silver. There can be no assurance that such statements
will prove to be accurate, and actual results and future events
could differ materially from those anticipated in such
statements. Forward-looking statements reflect the beliefs,
opinions and projections on the date the statements are made and
are based upon a number of assumptions and estimates that, while
considered reasonable by the respective parties, are inherently
subject to significant business, economic, competitive, political
and social uncertainties and contingencies. Many factors,
both known and unknown, could cause actual results, performance or
achievements to be materially different from the results,
performance or achievements that are or may be expressed or implied
by such forward-looking statements and the parties have made
assumptions and estimates based on or related to many of these
factors. Such factors include, without limitation:
satisfaction or waiver of all applicable conditions to closing of
the Transaction including, without limitation, receipt of all
necessary securityholder, court, stock exchange and regulatory
approvals or consents and lack of material changes with respect to
the parties and their respective businesses; the synergies expected
from the Transaction not being realized; business integration
risks; fluctuations in general macro-economic conditions;
fluctuations in securities markets and the market price of Kootenay
Silver's shares; fluctuations in the spot and forward price of
silver, base metals or certain other commodities; fluctuations in
the currency markets (such as the Canadian dollar versus the U.S.
dollar); changes in national and local government, legislation,
taxation, controls, regulations and political or economic
developments; risks and hazards associated with the business of
mineral exploration, development and mining (including
environmental hazards, industrial accidents, unusual or unexpected
formations, pressures, cave-ins and flooding); inability to obtain
adequate insurance to cover risks and hazards; and the presence of
laws and regulations that may impose restrictions on mining;
employee relations; relationships with and claims by local
communities and indigenous populations; availability and increasing
costs associated with mining inputs and labour; the speculative
nature of mineral exploration and development, including the risks
of obtaining necessary licenses, permits and approvals from
government authorities; title to properties; the failure to meet
the closing conditions thereunder and the failure by counterparties
to such agreements to comply with their obligations
thereunder. In addition, Northair may in certain
circumstances be required to pay a non-completion or other fee to
Kootenay Silver, the result of which could have a material adverse
effect on Northair's financial position and results of operations
and its ability to fund growth prospects and current
operations. Readers should not place undue reliance on the
forward-looking statements and information contained in this news
release concerning these times. 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 Silver and Northair expressly
disclaims any obligation or undertaking to release publicly any
updates or revisions to any such statements to reflect any change
in Kootenay Silver or Northair's expectations or any change in
events, conditions or circumstances on which any such statement is
based.
Cautionary Note to United States Investors Concerning
Estimates of Measured, Indicated and Inferred Mineral
Resources: This news release uses the terms "Measured and
Indicated Resources" and "Inferred Resources", which have a great
amount of uncertainty as to their existence, and great uncertainty
as to their economic feasibility. It cannot be assumed that all or
any part of a Measured and Indicated and/or Inferred Mineral
Resource will ever be upgraded to a higher category. Under Canadian
rules, estimates of Inferred Resources may not form the basis of
feasibility or other economic studies. Kootenay Silver and Northair
advises U.S. investors that while this term is recognized and
required by Canadian regulations, the U.S. Securities and Exchange
Commission does not recognize it. U.S. investors are cautioned not
to assume that part or all of a Measured, Indicated and Inferred
resource exists, or is economically or legally minable.
SOURCE Kootenay Silver Inc.