TORONTO, June 4, 2012 /CNW/ - Pure Nickel Inc. (TSX: NIC) (the "Company") announces an amendment to the agreement with CS Mining, LLC, and receipt of US $500,000 payment. The amendment to the agreement will not impact the Company's planned operations and programs for 2012.
Pure Nickel and CS Mining have agreed to amend their settlement agreement. Under the original terms of the agreement, CS Mining was required to pay Pure Nickel US$1,000,000 on May 14, 2012. Effective today, CS Mining has paid Pure Nickel US$500,000 in partial payment of the original note and will place US$500,000 in escrow with an independent third party, First American Title Insurance Company. The escrowed funds will be released to Pure Nickel once a disputed net profits interest, discussed more fully below, is resolved. This amendment does not have any material effect on CS Mining or the overall economics of the settlement agreement between CS Mining and Nevada Star, other than the fact that the US$500,000 payment is being made into escrow instead of directly to Pure Nickel, in light of the disputed net profits interest. Due to the indemnification requirements of the settlement agreement, CS has no involvement in this litigation.
In the agreement signed with CS Mining in November 2011 Pure Nickel provided CS Mining with certain indemnities regarding title to the properties that Pure Nickel's subsidiary, Nevada Star had previously controlled. The indemnity specifically addressed a 12% net profits interest that was purportedly owned by among others, former officers and directors of Nevada Star.
On April 25, 2012 Pure Nickel and Nevada Star filed a complaint in United States District Court, District of Utah, Central Division against Robert Angrisano, Monty D. Moore, Scott Nicholson and Monty L. Moore. Monty D. Moore and Robert Angrisano were former officers and directors of Nevada Star and former directors of Pure Nickel. The claim seeks:
- A court determination that the net profits interest is invalid and unenforceable due to, among other things, breach of fiduciary duties.
- A court determination that the net profits interest is unenforceable because it is specific to the mining activities of Nevada Star and it is not tied to the mining claims.
- Compensation to Pure Nickel for damages due to the pursuit of the invalid and unenforceable net profits interest and interference in the business relationship between Pure Nickel and CS Mining.
- Compensation to Pure Nickel for the costs and damages of other title deficiencies.
A copy of the full claim document is available at http://www.purenickel.com/i/pdf/Complaint-Exhibits.pdf.
About Pure Nickel Inc.
Pure Nickel is a mineral exploration company with a diverse collection of Nickel, Copper and Platinum Group Element exploration projects in North America. The Company is currently active on its flagship MAN property, which is fully funded under an option agreement with Itochu Corporation of Tokyo, Japan. The Company will also undertake an initial drill program on its 100% owned Salt Chuck property in the coming months, and will embark on a re-assay program at its William Lake project in the Thompson Nickel Belt. In addition, the Company is actively pursuing other, non-nickel, properties in North America and overseas.
Forward Looking Statements
Some of the statements contained herein may be forward-looking statements which involve known and unknown risks and uncertainties. Without limitation, statements regarding potential mineralization and resources, exploration results, expectations, plans, and objectives of Pure Nickel are forward-looking statements that involve various risks. The following are important factors that could cause Pure Nickel's actual results to differ materially from those expressed or implied by such forward-looking statements: changes in the world wide price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future exploration activities and cash flows, and the uncertainty of access to additional capital. There can be no assurance that forward-looking statements will prove to be accurate as actual results and future events may differ materially from those anticipated in such statements. Pure Nickel undertakes no obligation to update such forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on such forward-looking statements.
The TSX Exchange does not accept responsibility for the adequacy or accuracy of this release.
For further information:
The Howard Group Investor Relations
T. (888) 221-0915
Pure Nickel Inc.
President and CEO
T. (416) 644-0066