AM GOLD INC. (TSX-V: AMG; Frankfurt: AMX) ("AM Gold" or the "Company") further to the Company's news release of November 13, 2014, AM Gold announces that it is in receipt of a notice of arbitration from Rokmaster Resources Corp. ("Rokmaster"). The notice of arbitration was filed by Rokmaster in connection with matters relating to the Option and Joint Venture Agreement dated July 16, 2012, as amended, among the Company, the Company's Peruvian subsidiary, and Rokmaster (the "Option and JV Agreement").
As disclosed previously, Rokmaster failed to make a $400,000 payment due under the Option and JV Agreement and subsequently declared force majeure and initiated the arbitration. These tactics are, in AM Gold's view, intended to avoid its obligations under the Option and JV Agreement and to try to coerce AM Gold into a business combination pursuant to terms dictated by Rokmaster. The Company further believes Rokmaster's claims are attempts to shift to AM Gold blame for Rokmaster's own operational, managerial and financial deficiencies.
AM Gold maintains that the basis for the arbitration claims is unfounded and without merit.
According to Rokmaster's most recent Management Discussion & Analysis for the period ended September 30, 2014, Rokmaster disclosed that it had $25,749 in cash and a working capital deficiency of $1,134,412. Accordingly, it does not appear that Rokmaster currently has adequate cash on hand to comply with the terms of the Option and JV Agreement or to finance the arbitration.
As disclosed in AM Gold's Annual General Meeting materials, AM Gold has arranged a $400,000 loan from a non-arm's length party. Such loan is subject to a number of conditions including shareholder approval and is more particularly described in the Annual General Meeting materials, copies of which can be found under the Company's SEDAR profile at www.sedar.com.
About AM Gold Inc.
AM Gold Inc. is a publicly held resource company based in Vancouver, Canada. The Company is listed on the TSX Venture Exchange under the symbol "AMG" and is quoted on the Frankfurt Exchange under the symbol "AMX". The Company is focused on creating shareholder value through the development of the Company's gold and gold-copper projects in the Yukon and Peru while building a portfolio of quality pipeline projects in North and South America. The Company's Red Mountain gold property is located in central Yukon Territory approximately 55 kilometres northwest of the community of Mayo in the Tintina Gold Belt. The Company's Red Mountain gold property consists of approximately 3,600 hectares of contiguous quartz claims. 52 of such quartz claims (1,168 hectares) are held 100% by AM Gold subject to a net smelter returns royalty. AM Gold may reduce the NSR payable on the 52 quartz claims from 2% to 0.5% by agreeing to pay $1,000,000 for the first 1% of the NSR and $750,000 for the second 0.5% of the NSR at any time, at AM Gold's discretion. An additional 131 quartz claims (2,430 hectares) are held 100% by the Company with no NSR. AM Gold's Pinaya gold-copper project is located approximately 775 kilometres southeast of the city of Lima, Peru in the Tintaya Gold Belt. Subject to the option agreement between the Company and Rokmaster Resources Corp., the Company maintains 100% ownership of 35 mining concessions covering the 19,200 hectare Pinaya land position. AM Gold's corporate offices are located Suite 605 - 369 Terminal Avenue, Vancouver, British Columbia, V6A 4C4 (phone: 604-646-0067).
ON BEHALF OF AM GOLD INC.
/s/ "John Fiorino"
John Fiorino
Chief Executive Officer
For further information on AM Gold, please contact Murray Caruth at 1-604-646-0067 or by email at [email protected], or visit AM Gold's website at: http://www.amgold.ca.
Cautionary Statement Regarding "Forward-Looking" Information
Some of the statements contained in this press release are forward-looking statements and information within the meaning of applicable securities laws. Forward-looking statements and information can be identified by the use of words such as "expects", "intends", "is expected", "potential", "suggests" or variations of such words or phrases, or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements and information are not historical facts and are subject to a number of risks and uncertainties beyond the Company's control. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this news release. Accordingly, readers should not place undue reliance on forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, except as may be required by law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.