Athena Silver (OTCBB:AHNR) has signed a new lease/purchase option agreement with regards to its Langtry silver project in California.

As quoted in the press release:

The highlights of the new 20-year lease/option include:

  • Annual option payment of $20,000 due on March 15, 2016 and $20,000 due on September 15, 2016 together with accrued lease rent from our prior lease of $20,000 payable on March 15, 2016 and $20,000 on September 15, 2016.  The March 15, 2016payments were made concurrently with the execution of this new agreement.   50% of our annual option payments are applicable to the purchase price should we exercise our option to purchase the property.
  • Subsequent annual option payments start at the greater of $40,000 or the value of 2,500 troy ounces of silver in the calendar month prior to March 15, 2017. The annual option payments have other escalation provisions during subsequent years.
  • We have been granted a purchase option to acquire fee simple title to the Langtry patented claims and other unpatented claims. In the first three (3) years, the purchase price is a one-time $5,000,000 payment; and thereafter in subsequent years the price escalates with a further upward adjustment if silver trades at or over $20 per troy ounce.
  • Other consideration includes the transfer by Athena, for nominal consideration, to the lessor of two BLM unpatented mining claims, the Lilly 10 and Quad Deuce XIII, which are also part of the land package being optioned and leased back to Athena.   Our prior lease agreement included deferred rent of $130,000 that is also payable to the lessor under certain circumstances under the new agreement.

Athena president and CEO, John Power, said:

Our original lease that we signed 6 years ago was no longer viable in the current depressed precious metals marketplace.   Fortunately, the lessor worked with us to replace our former arrangement with a new mutually beneficial agreement. We believe this new agreement combined with our other accomplishments achieved in recent months to improve our land position, reduce our royalty burdens on the project and strengthen our permitting status, have significantly improved the value of our flagship property and our long-term prospects. We are one of a very few publicly traded pure play domestic silver exploration companies.

Click here for the full press release.

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