When You Miss a Gold Delivery VANCOUVER, Jan. 29, 2014 /CNW/ - Veris Gold Corp. ("Veris" or the "Company") (TSX: VG) (OTCQB: YNGFF) (Frankfurt Xetra Exchange: NG6A) advises that it has received a notice of default dated January 28, 2014 from Deutsche Bank AG, London Branch ("DB"), with respect to payment defaults under the forward gold purchase agreements between the Company and DB.
The Notice of Default relates to the failure to make the monthly December gold delivery, or pay the cash equivalent of the gold delivery shortfall, for December, 2013, under each of the Forward Gold Purchase Agreements dated August 12, 2011, and the Second Lien Forward Gold Purchase Agreement dated as of February 7, 2012, each among DB and the Company and certain of its affiliates. The two agreements are described in more detail in the Company's news releases dated August 15, 2011 and February 8, 2012.
The Company was unable to make the scheduled December 2013 gold delivery under each of the two forward gold purchase agreements due to an electrical accident resulting in a fire that occurred in the primary crushing building located at the Jerritt Canyon mill operations. The fire resulted in a temporary suspension of operations, which negatively affected production during the month of December 2013. The forward gold purchase agreements with DB do not contain a "force
majeure" provision. DB has advised the Company that it is considering what actions, if any, it may wish to make in response to the contract concerning this event. These actions include an assignment of DB's rights and obligations under the agreements to a third party or realizing on the security pledged, being the Company's direct and indirect interest in the Jerritt Canyon Mine in Nevada.
DB has recently announced the closure and divestiture of its mining loan portfolio over the next few months; the Company has commenced negotiations with several third parties for the purchase of the existing DB forward gold loans with restructured and lengthier terms.