VANCOUVER, BRITISH COLUMBIA--(Marketwired - Aug. 21, 2013) - Redstar Gold Corp. (News - Market indicators) ("Redstar" or the "Company") is pleased to announce that it has closed an over-subscribed non-brokered private placement of 39,383,363 units at a price of $0.055 per unit (the "Units") 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.
About Redstar
Redstar currently holds 100% of the Newman Todd Project in Red Lake Ontario. Newman Todd, currently optioned to Confederation Minerals (TSX VENTURE:CFM), is a new high grade gold discovery in the prolific Red Lake Gold Camp. Drilling to date has outlined numerous zones of high grade gold mineralization along a 1.8Km corridor within the Newman Todd Structure ("NTS"). The gold mineralization in the NTS remains open along strike and at depth.
Redstar owns 100% of 11 gold projects in Nevada and owns the Anglogold-Ashanti Database ("Database") for Nevada and surrounding states. The Database has proven to be effective in developing quality projects in a variety of known gold producing regions of Nevada including the Carlin Trend, Bullfrog District and the Cortez Trend.
The Unga Project in south-western Alaska consists of two properties acquired by Redstar in 2011: the Unga-Popof and Shumagin properties. The Project includes the high-grade Shumagin gold deposit, the Centennial disseminated bulk-tonnage gold deposit and the Apollo-Sitka high-grade gold vein system, which produced approximately 150,000 oz of gold in the early 20th century. Redstar is purchasing a 100% interest in the Shumagin Property from Magnum Hunter Resources.
On Behalf of the Board, Redstar Gold Corp.
R. Bob Singh, President and CEO
Forward-Looking Information: This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address events or developments that Redstar Gold Corporation (the "Company") expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, and continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made. Except as required by applicable securities laws, the Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
