Oroco Provides Legal Update
MARCH 5, 2019
NEWS RELEASE
FOR IMMEDIATE RELEASE:
OROCO PROVIDES LEGAL UPDATE
VANCOUVER, British Columbia – (March 5, 2019) Oroco Resource Corp. (
TSX-V: OCO
) (“
Oroco
” or
“
the Company
”) wishes to provide an update on the legal status of its interests in those mineral
concessions in Sinaloa State, Mexico known as the Santo Tomas Concessions. This update is
provided in furtherance of the Company’s news release of October 9, 2018, wherein Oroco
announced that it had entered into a definitive option agreement with Altamura Copper Corp.
and its shareholders to acquire, indirectly, certain interests in those concessions.
There are several areas of current legal activity relating to protecting and enforcing the
Company’s interest in the Santo Tomas Concessions. At present, the following initiatives,
amongst others, are expected to validate and maintain the status quo of the titles and eventually
remove any unwarranted ownership claims to the Santo Tomas Concessions as are currently
being made by Aztec Copper Inc., an Arizona company, and its Mexican subsidiary, Prime Aztec
Mexicana S.A de C.V. (together, the “Aztec Companies”):
1.
Closure Petition
: A petition has been filed with the Thirteenth Civil Court of the City of
Mexico (the “State Court”) seeking a declaration that a judgement generated in early
2016 by that court in favour of the Aztec Companies (the “Judgement”) cannot be
executed or enforced. The petition is based on what are, in the strong opinion of our
legal counsel, certain fatal and incurable flaws which exist in the underlying
documentation necessary to the registration of any title interest in favour of the Aztec
Companies. It should be noted that the Company does not expect to prevail in the State
Court for reason of the demonstrated reluctance of the Mexican courts at this level to
reverse or nullify previous decisions. However, the Company fully expects to prevail at
the Appeal Court level. Such an eventual result would permanently prohibit any further
attempt to enforce the Judgement.
2.
Amparo relating to Improper Service
: An “amparo” action has been commenced in the
Ninth District Court for Civil Matters in Mexico City (the “Amparo Court”) by Fierce
Investments Ltd. Fierce is seeking the nullification of the entire Aztec trial and the
resulting Judgment for reason that Fierce was not notified of, or represented at the trial.
A successful outcome will result in the trial and the resulting Judgment being nullified
without prejudice to Aztec’s ability to recommence the action. However, any such
initiative by the Aztec Companies would be unsupported by the true facts of the matter
and they would have no legitimate claim to any interest in the Santo Tomas Concessions.
At present, the recent decision of the Amparo Court to deny the Fierce application due to
OROCO RESOURCE CORP.
1201-1166 Alberni Street, Vancouver, BV V6E 3Z3
T: 604.688.6200 F: 604.688.6260
www.orocoresourcecorp.com
a discrepancy between the corporate designation of the applicant and its designation
during the Aztec trial is in the process of being appealed. Once again, the Company
expects that this application will be upheld at the appeal level.
3.
Criminal Complaint
: In the course of these matters, certain facts have come to light
which have prompted the decision to initiate a criminal complaint against Ron Arnold, the
President of Aztec Copper Inc. and others. This complaint relates to the activities of
Arnold and his associates in regard to the procedural fraud which precipitated the Aztec
Court judgement. The Company will provide further details of this complaint once it is
formally filed in Mexico.
4.
Arizona Corporate Action
: Legal actions have been initiated in Arizona in regard to
certain corporate matters involving Aztec Copper Inc. and its Alberta-based management.
To date, communication with Stephen C. Snyder, legal counsel responding on behalf of
Aztec management, quite expectedly has generated a continuous process of obfuscation
and avoidance. At present, Aztec has failed to comply with two default judgements
obtained in the Arizona Superior Court. Furthermore, at a meeting of the shareholders of
Aztec held on February 23, 2019 in Edmonton, Alberta, Aztec management intentionally
withheld certain written information from those Aztec shareholders who questioned the
status of the Santo Tomas matter. The Company is now reviewing the details of that
meeting so as to consider how those actions may affect the related matters currently
before the Arizona courts.
5.
Administrative Appeal
: Certain initiatives have been taken with the Mexican Mining
Registry on behalf of the Mexican subsidiaries of Altamura Copper Corp., a B.C. company,
the ownership of which is subject to an irrevocable purchase option held by the Company.
In 2016, the registration of the sale and transfer of the Santo Tomas concessions by one
affiliate of Altamura to another was filed with the Mining Registry prior to the annotation
in the Registry of the Aztec judgement. While Mexican law favours the completion of that
transfer, notice of a prior claim, since removed, caused the effective suspension of the
Santo Tomas Concession transfer at that time. The Company has subsequently taken the
position that completion of the intended sale and transfer is not required until after the
Aztec matter is finitely resolved. In the meantime, Altamura indirectly controls fifty
percent of the registered owner of the Santo Tomas concessions, Compania Minera Ruero
S.A. de C.V., and holds an option to acquire the other fifty percent of the ownership,
thereby providing a second pathway to outright control of the Santo Tomas project.
Furthermore, Oroco has received a legal opinion from Joaquin Cabrera, a senior partner in
a highly-regarded Mexican law firm, that in regard to the underlying contract necessary to
enforceability of the Judgement, “the (Mexican Mining Registry) would never agree to
register the Aztec Contract, and of that I am certain.”
OROCO RESOURCE CORP.
1201-1166 Alberni Street, Vancouver, BV V6E 3Z3
T: 604.688.6200 F: 604.688.6260
www.orocoresourcecorp.com
Commenting on the Aztec judgement, Oroco President and CEO, Craig Dalziel stated: “Despite
the fact that the Aztec Companies have an ill-gotten judgement noted in the Mexican Mining
Registry, the Company firmly asserts that Aztec has no effective legal position. Favourable
resolution of the Aztec judgement issue on behalf of Altamura is only a matter of time, not a
question of outcome. Relevant members of the Mexican judiciary are now aware of the
circumstances under which the Judgement was obtained, and those parties such as Ramon Parra
of Mexico City that are attempting to advance the Aztec interests have been identified. The only
measurable consequence to the existence of the Aztec judgement is that it effects a
corresponding delay in the commencement of the option period associated with the purchase by
Altamura of the balance of the registered owner of the Santo Tomas concessions. However, the
existing outright control by Altamura of the contractual owner of the property, Xochipala Gold
S.A. de C.V., allows the Company and its affiliates to continue to advance the Santo Tomas
project.”
With respect to the status of the Altamura acquisition, the independent qualified person
referenced in the Company’s January 14, 2019 news release is currently on site at Santo Tomas
finalizing data accumulation in regard to the Technical Report which is necessary to support the
acquisition of Altamura. The Company expects the first draft of that report within 10 days.
Thereafter, the Company will provide a full update on the project’s site-related activities.
For further information, please contact:
Mr. Craig Dalziel, President and CEO
Oroco Resource Corp.
Tel: 604-688-6200
www.orocoresourcecorp.com
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.
Cautionary Note Regarding Forward Looking Information
This news release includes certain “forward-looking information” and “forward-looking statements” (collectively
“forward-looking statements”) within the meaning of applicable Canadian securities legislation. All statements,
other than statements of historical fact included herein, including without limitation, statements relating to future
events or achievements of the Company, are forward-looking statements. There can be no assurance that such
forward-looking statements will prove to be accurate, and actual results and future events could differ materially
from those anticipated or implied in such statements. Many factors, both known and unknown, could cause actual
results, performance or achievements to be materially different from the results, performance or achievements that
are or may be expressed or implied by such forward-looking statements. Readers should not place undue reliance
on the forward-looking statements and information contained in this news release concerning these matters.
OROCO RESOURCE CORP.
1201-1166 Alberni Street, Vancouver, BV V6E 3Z3
T: 604.688.6200 F: 604.688.6260
www.orocoresourcecorp.com
Oroco does not assume any obligation to update the forward-looking statements should they change, except as
required by law.
OROCO RESOURCE CORP.
1201-1166 Alberni Street, Vancouver, BV V6E 3Z3
T: 604.688.6200 F: 604.688.6260
www.orocoresourcecorp.com