COEUR d'ALENE - A U.S. Bankruptcy Judge approved the sale of the historic Sunshine Mine near Kellogg on Thursday.
Posted: Friday, May 7, 2010 10:05 am
http://www.shoshonenewspress.com/news/article_e80d77f8-59fa-11df-8ad4-001cc4c03286.html
U.S. Bankruptcy Judge Terry Myers, of Boise, ruled that Sterling Mining, which is reorganizing under Chapter 11, be allowed to sell its stock and assets, with its primary asset being a lease of the Sunshine Mine, with an option to buy the silver mine.
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Those will now go to Silver Opportunity Partners LLC, which bid $24 million for Sterling's stocks and assets late last month.
"We think it's an appropriate ruling," said Mark Wallace, SOP transition director. "We're excited about being the owners and good custodians of Sunshine Mine and in developing it in the right manner."
Wallace said SPO, owned by the New York-based Electrum Group of Companies, a worldwide investor in gold, silver and platinum mines, doesn't have a timetable should it get the mine operational again. Sterling Mining filed for Chapter 11 protection in March 2009, but ceased operations in September 2008 due to the economic downturn and financial challenges.
"We want to make sure we are perfect custodians and it's developed the right way," Wallace said. "And that means being patient, being deliberate, and frankly not over-promising."
Sterling's biggest asset is a lease and purchase-option for the Sunshine Mine, which is owned by Sunshine Precious Metals Inc. SPMI, owned by Robert Mori, opposed including the lease in SOP's winning bid on grounds that the lease was invalid and belonged to SPMI.
Myers said at the Federal Court Building in Coeur d'Alene that the lease should be included and the sale could go through, which includes a $5 million lease purchase agreement for the mine.
Wallace said they plan to exercise that option, and will be analyzing the mine from several perspectives - safety, economic and environmental - for potential exploration.
"We were all optimistic," said Joe Guardipee, the mine's foreman, outside the courtroom. "We all believed he would rule in Sterling's favor because it was the right thing to do."
The mine is under care and maintenance right now, employing 16 people. The mine employed more than 200 people before it closed initially in 2001, producing 360 million ounces of silver in 125 years of operation.
"It gives the valley the certainty it needs right now," said Sandy Patano, who works on the North Idaho transition team with Electrum Group Companies, after the ruling.
Money gained from the planned sale of Sterling Mining's assets and stock would be used to pay creditors, satisfying the company's debt.
Posted in News on Friday, May 7, 2010 10:05 am
Sterling Mining lease questioned
http://www.shoshonenewspress.com/news/article_e1b6d23e-5863-11df-bc71-001cc4c03286.html
Posted: Wednesday, May 5, 2010 9:31 am | Updated: 11:05 am, Thu May 6, 2010.
By DAVID COLE Hagadone News Network | 0 comments
COEUR d'ALENE - A top representative of the company that owns the historic Sunshine Mine near Kellogg testified in U.S. Bankruptcy Court here on Tuesday that Sterling Mining Co.'s lease was no longer in good standing.
"It was our opinion that the lease was terminated," said J. Edward Short, general manager of Sunshine Precious Metals.
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Sterling Mining, which is reorganizing under Chapter 11, is seeking approval of a sale of its stock and assets, with its primary asset being a lease of the Sunshine Mine, with an option to buy the silver mine.
Sterling Mining said a successful bidder on its stock and assets late last month was Silver Opportunity Partners LLC, with a cash price of $24 million. Silver Opportunity is a member of Electrum Group of companies.
Short also said some personal property at the Sunshine Mine wasn't within the Sterling Mining lease. If that's true, it would make a complete purchase of the mine and equipment by a company seeking to exercise a purchase option within a lease impossible.
Short said his employer "never contemplated" trying to sell the mine to Silver Opportunity Partners, cutting Sterling Mining out of the sale.
He said Sunshine Precious Metals hasn't identified another tenant for the mine, and doesn't have a buyer "waiting in the wings."
Short, an attorney, was called to the stand in large part because he helped put together Sterling Mining's lease of the mine. Robert Mori is the owner of Sunshine Precious Metals.
Sterling Mining acquired the rights to the Sunshine Mine and related assets in mid-2003 and began initial production in late 2007.
Due to the economic downturn in late 2008, coupled with internal financial challenges, operations were suspended in September 2008. Sterling Mining filed for Chapter 11 protection in March 2009.
Money gained from the planned sale of Sterling Mining's assets and stock would be used to pay creditors.
U.S. Bankruptcy Judge Terry Myers, of Boise, has to approve the sale. Myers scheduled the hearing to continue today in Coeur d'Alene, with Short still on the stand.
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