VANCOUVER, BC: Western Copper and Gold Corporation ("Western" or the "Company") (TSX:WRN; NYSE MKT:WRN) announces that the Company and its wholly owned subsidiary, Casino Mining Corporation, have entered into a royalty sale agreement (the "Agreement") dated December 20, 2012 with 8248567 Canada Limited, an arm's length purchaser, (the "Purchaser") whereby the Purchaser agrees to cancel its 5% net profits interest royalty in the Casino Project and pay US$32 million in exchange for a 2.75% net smelter returns royalty in the Casino Project (the "Transaction").
In accordance with the terms of the Agreement, among other things:
- The Purchaser will obtain a 2.75% net smelter returns royalty (the "NSR Royalty") on the future sale of any metals and minerals derived from the Casino Project;
- The Purchaser will agree to cancel the 5% net profits interest in the Casino Project that it already owns on certain claims held by Western; and
- Western will receive a cash payment of US$32 million upon completion of the Transaction for Casino Project development expenditures and general working capital.
Western has the option to repurchase 0.75% of the NSR Royalty (resulting in a 2.00% remaining royalty) for the following amount:
- US$39 million if the amount is paid on or prior to December 31, 2013; or
- US$59 million if the amount is paid after January 1, 2014 but on or before December 31, 2017.
