South American Silver Corp. (TSX:SAC) (OTCQX:SOHAF) is pleased to announce that on May 23, 2013 the Company entered into an agreement with a third party funder pursuant to which the Fund will cover South American Silver’s future costs and expenses related to the international arbitration proceedings against the Plurinational State of Bolivia for the expropriation of the Malku Khota project. The funding is on a non-recourse basis and includes costs and expenses of the enforcement of any award rendered by the arbitral tribunal. No broker has acted in the transaction.
The Fund specializes in the funding of international arbitration proceedings and in providing assistance in connection with the enforcement of arbitration awards.
South American Silver continues to have control over the conduct of the international arbitration proceedings and to have the right to settle with Bolivia, discontinue proceedings, pursue the proceedings to trial and take any action it considers appropriate to enforce any resulting judgment or award.
Under the terms of the privileged arbitration funding agreement, the Company has given certain warranties and covenants to the Fund and has provided security for its obligations. In consideration for the funding, the Company has agreed to pay to the Fund a portion of any recoveries received pursuant to the arbitration proceedings or any settlement with Bolivia.
Phillip Brodie-Hall, President and CEO of South American Silver said, “This is a significant milestone for South American Silver and is very good news for our shareholders. The fact that a large and respected international investment fund is prepared to put its money at risk to support our case speaks volumes for the validity and value of our claim against Bolivia. This agreement provides us with the funds we need to pursue our case against Bolivia, at the same time freeing-up cash to allow us to actively invest in our core business of acquiring, exploring and developing quality mineral projects.”
Details of the Company’s dispute with the Bolivian Government can be found in the Company’s news releases dated October 23, 2012, December 12, 2012, and April 30, 2013. The aforementioned information is available on www.sedar.com or on the Company’s website www.soamsilver.com
About South American Silver Corp.
South American Silver Corp. is a growth focused mineral exploration company creating value through the exploration and development of the large scale Escalones copper-gold project in Chile, the pursuit of new opportunities, and the realization of value from the Malku Khota project in Bolivia. South American Silver Limited is a company incorporated in the Bermuda Islands, an overseas territory of the United Kingdom, which through its wholly owned Bahaman subsidiaries: Malku Khota Ltd, G.M. Campana Ltd. and Productora Limited., owns one hundred per cent of the outstanding shares of Compania Minera Malku Khota S.A., a Bolivian company, holder of the Malku-Khota mining concessions until their nationalization by the Bolivian Government. The Company’s approach to business combines the team’s track record of discovery and advancement of large projects, key operational and process expertise, and a focus on community relations and sustainable development. Management has extensive experience in the global exploration and mining industry
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We acknowledge the [financial] support of the Government of Canada.