Del Toro Executes New Agreement Including Royalty For The Natchez Pass Gold Property
CARSON CITY, Nev., June 18, 2013 (GLOBE NEWSWIRE) -- Del Toro Silver Corp. (OTCBB:DTOR) ("Del Toro" or the "Company") is pleased to announce that, on June 6, 2013, the Company executed a Purchase Option Termination agreement with Natchez Pass LLC to terminate the August 31, 2012 Partial Purchase Option Agreement. The Termination Agreement provides the Company with a 5% Net Smelter Royalty ("NSR") on production from the Natchez Pass Gold Property (AKA the "Nick").
The Company renegotiated the terms for its participation in the property so additional private equity could be invested into Natchez Pass LLC on more favorable terms than might otherwise be available. This capital infusion will be used to replace the existing reclamation bond, complete mill upgrades, and drill a new water well — which will enable operation of the mine. The work plan has been put into action and placer mining is expected to begin within the next 30 days.
In addition to the 5% NSR, the Company will be paid 5% of the net proceeds from any sale of the mine to a third party, with a $300,000 minimum return from such sale. The Company is required to issue 2,000,000 shares of its common stock to certain third parties as part of the Termination Agreement, but the terminated option would have required the Company to pay $4,005,000 and issue up to 5,000,000 shares of common stock to Natchez Pass LLC over a 5 year period.Del Toro president Greg Painter states "We still believe the mine is a very valuable asset with significant upside potential. However, the current tough market conditions for raising capital prevented us from exercising the original option in a timely manner. This renegotiated agreement allows the Company to continue its participation in the mine with no future capital or stock contribution requirements."
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