Defiance Silver Corp (“Defiance” ) is pleased to announce that it has signed a two-year extension to its option agreement with IMPACT Silver Corp. (“IMPACT”) for the acquisition of the 200 tpd Santa Gabriela processing plant, associated surface rights, and 10 mining concessions in the historic silver mining district of Zacatecas in central Mexico.
Under terms of the revised agreement executed on July 9, 2013, Defiance has an option of making two interim payments to extend the final closing date for making the purchase payment for up to two years to September 9th, 2015. Defiance Silver may pay $10,000 or 150,000 common shares of Defiance Silver on or before September 9th, 2013 to extend the term to September 9th, 2014, and $25,000 or 350,000 common shares of Defiance Silver on or before September 9th, 2014 to extend the term to September 9th 2015.
Under terms of the option to purchase agreement signed on September 9, 2011, the term of the agreement was two years terminating in September 9th 2013. Defiance made the initial payment of 2,680,500 shares in February 2012 with a closing purchase payment of $1,995,000 due on the earlier of the final closing date of September 9th, 2013, or upon the processing plant achieving commercial production.
This agreement is subject to approval by the TSX Venture Exchange.
Defiance is also pleased to announce a non-brokered private placement of up to 5,000,000 units of Defiance at a price of $0.10 per Unit for gross proceeds of up to $500,000. The placement is subject to an overallotment option whereby the Company may increase the Offering by up to 50% depending on market demand.
Each Unit will consist of one common share of the Company and one half common share purchase warrant. Each full warrant will entitle the holder to purchase one common share of the Company for a period of two years from the closing date of the Offering at a price of $0.15 per common share during year one and $0.20 during year two.
Closing of the placement is subject to receipt of all required regulatory approvals including the approval of the TSX Venture Exchange. Securities issued under the placement will be subject to a four month hold period which will expire four months from the date of closing. Finder’s fees may be payable in compliance with TSX Venture Exchange policies on some or all of the placement.
The proceeds from the offering will be used at the discretion of the Company for: metallurgical testing, ongoing refurbishment of the Santa Gabriela Mill, development of the San Acacio Silver Mine, and for general working capital purposes.
“The support of IMPACT, Defiance’s largest shareholder, in agreeing to modify the terms of the option to purchase agreement, is much appreciated” states Bruce Winfield, President and CEO of Defiance, “as it allows Defiance to continue work to bring the San Acacio Mine and Santa Gabriela processing plant back into production.”
About Defiance Silver Corp.:
Defiance is a near term silver producer engaged in the acquisition, exploration, and development of advanced silver projects in the Zacatecas Silver District, Mexico. The Company’s efforts are focused on: 1) the exercising of an option to purchase the San Acacio Mine, 2) the purchase and refurbishment of the 200 tpd Santa Gabriela Mill, and 3) the definition of feed for the Santa Gabriela Mill from surface dumps and from the San Acacio Mine with its 43-101 compliant silver resource (reference Defiance Silver Corp New release dated October 25, 2012).
Disclaimer: Although Defiance is working to bring the Santa Gabriela Mill and the San Acacio Mine back into production, Defiance has not completed a 43-101 compliant Feasibility Study. Hence the project has increased uncertainty and increased economic and technical risks of failure associated with its development.
Mr. Bruce Winfield, P. Geo., President and CEO of the Company is the Qualified Person for information contained in this press release. Mr. Winfield is a Qualified Person within the meaning of NI 43-101.
On behalf of the Defiance Silver Corp
“W.D. Bruce Winfield”
W.D. Bruce Winfield
President and CEO
| 1500 – 409 Granville Street Vancouver, BC V6C 1T2 | www.defiancesilver.com Tel: 778-729-0333 |
Forward-Looking Statements. This Defiance News Release may contain certain “forward-looking” statements and information relating to Defiance that are based on the beliefs of Defiance management, as well as assumptions made by and information currently available to Defiance management. Such statements reflect the current risks, uncertainties and assumptions related to certain factors including but not limited to, exploration and development risks, expenditure and financing requirements, title matters, operating hazards, metal prices, political and economic factors, competitive factors, general economic conditions, relationships with vendors and strategic partners, governmental regulation and supervision, seasonality, technological change, industry practices, and one-time events. Should any one or more risks or uncertainties materialize or change, or should any underlying assumptions prove incorrect, actual results and forward-looking statements may vary materially from those described herein. Specifically, there is no assurance Defiance will be able to raise the minimum or maximum private placement on the terms and conditions referred to above. Defiance does not assume the obligation to update any forward-looking statement.
