Nare settles legal dispute with scrip issue

West Perth-based Nare Diamonds Ltd has settled a legal dispute between subsidiary New Diamond Corporation Ltd and SM Mining Contractors Ltd through the issue of shares and options, though with no admission of liability.

The full text of a Nare announcement is pasted below

Australian based diamond exploration and development company Nare Diamonds Limited (ASX: NDM) ("Nare" or the "Company") advises that it has agreed terms to settle an historical claim between its wholly owned subsidiary, New Diamond Corporation (Pty) Ltd ("NDC") and the previous mining contractor at the Schmidtsdrift Alluvial Diamond Mine.

Under the settlement, the Company has agreed to issue the following securities to SM Mining Contractors (Pty) Ltd

• 2 857 143 fully paid ordinary shares
• 4 000 000 options ($0.30 exercise price, 30/06/10 expiry date)
• 4 000 000 options ($0.35 exercise price, 30/06/10 expiry date)

The settlement of the claim has been made without admission of liability. Given that the circumstances that gave rise to this matter occurred prior to the Company taking control of NDC, the Board decided as flagged in the Company's IPO Prospectus, that it would settle this matter through the issue of securities rather than undertake the risks involved in litigation.

The settlement is subject to satisfaction of one of the following conditions -