Redstar Gold (RGC-V) closes an oversubscribed $2.16-million private placement.
Aug 21, 2013 - News Release
Redstar Gold Corp. has closed an oversubscribed non-brokered private placement of 39,383,363 units at a price of 5.5 cents per unit for gross proceeds of $2,166,085. Each Unit consists of one (1) common share and one (1) non-transferable share purchase warrant. Each share purchase warrant will entitle the holder thereof to purchase one (1) additional common share of the Company for $0.07 per share for a period of twelve (12) months and for $0.10 per share for a subsequent period of fourteen (14) months. In connection with the private placement, an aggregate of 76,080 shares were issued and $87,364 was paid in cash to finders who introduced subscribers to the placement, pursuant to the policies of the TSX.V. All securities issued under the placement are subject to restrictions on resale to December 22, 2013. Together with the placement, the Company is pleased to report the appointment of Jacques Vaillancourt as Executive Chairman of the Board. Mr. Vaillancourt has 30 years of experience in global financial markets during which he was involved in over $35B of financings for the resource sector. He is currently the President of Mount Everest Finance S.A., which provides financings to natural resource companies. Additionally he is an Executive Director of Mineral and Financial Investments Limited, a London Stock Exchange (AIM) listed investment company. Prior, he was with HSBC as Managing Director and Global Head of Metals & Mining. From 1992 to 2009 he was at BMO Capital Markets as Managing Director and Head of European Equity Products and was part of the team that made BMO a leading global mining investment bank. Additionally, he has been a sell-side analyst at RBC Capital Markets, is a graduate of McGill University and is a CFA.
R. Bob Singh, President and CEO of Redstar Gold Corp. comments: "We are very pleased that Jacques has assumed the role of Executive Chairman of our board. Redstar will benefit greatly from his international experience in capital markets, financings and natural resource focused background. The addition of Jacques to our technically strong board will ensure that Redstar has effective exposure to global capital markets in times when traditional markets have made it difficult for junior mining companies to carry on the business of finding economic mineral deposits. Redstar will continue to focus on developing high quality assets in politically and economically stable jurisdictions."
Jacques Vaillancourt comments: "I am delighted to have the chance to be involved with such an exciting portfolio of projects and have the opportunity to help the management team create value for Redstar shareholders."
Proceeds from the financing will be applied to complete the purchase of 100% ownership of the Unga Project from Magnum Hunter Exploration (NYSE:MHR). This property is host to two parallel epithermal vein systems (the Shumagin and Apollo-Sitka trends) and was home to Alaska's first gold mine in the late 1800s to early 1900s. The property has seen very little exploration since that time. Recent drilling by Redstar (see news releases on the Company's website dated Nov 28, 2011 and Dec 6, 2011) confirmed that the Shumagin system contains high grade mineralization and remains open along strike and at depth. Additional work by Redstar on the entire property has identified several other targets along the trends which collectively measure in excess of 22km.
Previous drilling at the Shumagin vein led to a historic resource estimate of 254,000 tonnes (280,000 tons) grading 27.4 g/t (0.80 ounces per ton) gold and 127 g/t (3.7 opt) silver (SRK Consulting, 2000). The resource was based on shallow drilling in the late 1980s that was within about 150m (500 feet) of surface. A qualified person has not done sufficient work to classify the historical estimate as current mineral resources, the issuer is not treating the historical estimate as current mineral resources and the historical estimate should not be relied upon.
Dr. Jake Margolis and Andrea Diakow P.Geo are the qualified persons as defined by National Instrument 43-101 and have reviewed this news release. Dr. Margolis is the US Exploration Manager for Redstar Gold Corp. and Mrs. Diakow is the Canadian Exploration Manager for Redstar Gold Corp.
In addition, the Company reports that Mount Everest Finance S.A., a non-reporting company with an address at Rosas & Rosas, Delta Tower, 8th Floor, Via Espana 122, Panama, Republic of Panama, participated in the placement acquiring 21,000,000 units representing approximately 17.56% of the Company's issued and outstanding shares without giving effect to the exercise of any warrants. The Company is advised that the units were acquired for investment purposes. Mount Everest Finance S.A. has filed an early warning report which is available for review on www.sedar.com. The Company also reports that it has granted incentive stock options to purchase up to an aggregate of 1,000,000 shares to directors and employees of the Company. The options are exercisable at a price of $0.10 per share for a period of five years.
We seek Safe Harbor. |
