Red Oak Mining Closes Private Placement and Acquires Nuevo Taxco Silver-Gold Project in Mexico
Red Oak Mining Closes Private Placement and
Acquires Nuevo Taxco Silver-Gold Project in
Mexico
Vancouver, British Columbia--(Newsfile Corp. - November 13, 2020) -
Red Oak Mining Corp. (TSXV:
ROC.H) ("Red Oak")
has closed, on an oversubscribed basis, its previously announced non-brokered
private placement financing (the "Offering").
The Company issued 10,423,500 units (the "Units") at a
price of $0.10 per Unit for gross proceeds of $1,042,350.00. Each Unit consists of one Red Oak Share
and one Red Oak Share purchase warrant at a price of $0.20, exercisable for a period of two years from
issuance (the "
Warrants
"). The Offering was oversubscribed by $92,350.00.
In addition, the Company is pleased to announce it has executed the previously announced Property
Acquisition Agreement (the "
Agreement
") to acquire 100% interest in the Nuevo Taxco Silver-Gold
Property from Impact Silver Corp. (TSXV: IPT) (the "
Transaction
") by making certain staged cash
payments, issuing common shares in the capital of Red Oak to Impact Silver Corp.
and making
exploration expenditures over a 3-year period as follows: (i) $1,000 in cash which was paid upon
execution of the Letter of Intent in respect of the Transaction; (ii) $49,000 in cash and 500,000 common
shares within five (5) days of receiving TSX Venture Exchange (the "
TSXV
") approval of the Transaction
(iii) $200,000 in exploration expenditures on or before September 30th, 2021; (iv) $100,000 in cash,
1,000,000 common shares and $400,000 in exploration expenditures on or before September 30, 2022;
and (v) $150,000 in cash, 2,000,000 common shares and $800,000 in exploration expenditures on or
before September 30, 2023. Impact Silver Corp. will retain a one percent (1.0%) Net Smelter Returns
royalty ("
NSR
") which Red Oak has the option to buy back the NSR for $1,000,000. The Agreement
includes a one (1) km mutual area of interest from the outside boundary of the Zacualpan SE mineral
concession (the "
Property
") for a period of two (2) years.
The Transaction constitutes a Fundamental Acquisition, as that term is defined in the policies of the
TSXV. Following
completion of the Transaction, it is intended that Red Oak will seek to graduate its
listing from the NEX board of the TSXV to become a Tier 2 Mining issuer on the TSXV.
About the Nuevo Taxco Silver-Gold Project
In 2013, Impact Silver Corp. completed a detailed compilation of existing data, followed by a field
program which consisted of geological mapping and prospecting which identified a total of twenty-one
(21) silver-bearing veins with substantial widths on the Property. A collection of a total of 395 rock
samples with high silver values grading over one (1) kilogram per tonne silver occur in three samples
(1,430, 1,230, 1,100 g/t), 18 samples between 500 and 900 g/t silver and 92 samples between 100 and
499 gr/t silver, most of which come from the twenty-one (21) veins thus far identified. Historical mining in
the area dates back to the year 1520 with 11 historical mills from that era on the Property. The project is
considered to be significantly underexplored, with known silver and gold occurrences throughout the
Property.
About the Pregones Mining District
The Nuevo Taxco Silver Gold Project is within the Pregones Mining District which is one of three
principal production centers with the Zacualpan District situated ten kilometers to the northwest and
Taxco District ten kilometers to the southeast. The Pregones Mining District shares the same
stratigraphy as the Zacualpan District lower Cretaceous rocks of the Telooapan and Acapetlahuaya
Formations, both of which are a mixed volcanic and sedimentary assemblage. Whereas in the Taxco
District it is correlative sediments of the Mezcala Formation and limestones of the Morelos Formation,
also of Cretaceous age. The Pregones Mining District is considered prospective for high grade silver
and gold mineralization.
Red Oak has agreed to pay an arm's length party an finder's fee with regards to the property acquisition
equal to 10% of the value consideration for year one of the Agreement to be satisfied in common shares
of Red Oak at the same price per share as the Transaction, being approximately 100,000 common
shares.
The Company paid cash finders fees of $14,428,00 and issued 144,280 share purchase warrants (the
"Finder's Warrants") to finders in connection with certain subscriptions in the Offering.
The Finder's
Warrants have the same terms as the Warrants.
Red Oak intends to use the net proceeds from the Private Placement for general corporate purposes
and working capital.
All securities distributed pursuant to the Private Placement will be subject to a statutory hold period of
four months from the date of issuance. Closing of the Private Placement and the Transaction are subject
to receipt of all necessary regulatory approvals, including approval from the TSXV.
Carlos Cham Dominguez, is a "qualified person" within the meaning of the NI 43-101, and is responsible
for the technical information disclosed in this news release. Mr. Dominguez is a member of the American
Institute of Professional Geologists and a Certified Professional Geologist (CPG) No. 11760.
About Red Oak Mining Corp.
Red Oak Mining is a mineral exploration company committed to enhancing shareholder value by
advancing a diverse portfolio of mineral projects through collaborative partnerships and highly
experienced technical teams. Red Oak will continue to seek out and secure high-quality, unencumbered
projects through research, staking and strategic acquisitions. Throughout the exploration process, our
mission is to help maintain prosperous communities by exploring for and discovering resource
opportunities that build lasting relationships through honest and respectful business and environmental
practices.
On behalf of the Board of Directors
"Jay Roberge"
CEO/Chairman
Red Oak Mining Corp.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains "forward looking statements" within the meaning of applicable Canadian
securities legislation. Forward looking statements are necessarily based upon a number of estimates
and assumptions that, while considered reasonable by management, are inherently subject to
significant business, economic and competitive uncertainties and contingencies. Forward looking
statements in this press release include that we can complete our acquisition of the Property; that we
can complete the Private Placement; and that we close the Transaction. Forward looking statements
involve known and unknown risks, uncertainties and other factors that may cause actual financial
results, performance or achievements to be materially different from the estimated future results,
performance or achievements expressed or implied by those forward looking statements and the
forward looking statements are not guarantees of future performance. Red Oak's ability to complete
the Transaction and successfully conduct the business currently conducted by Impact Silver is
subject to a number of conditions, many of which are outside of Red Oak's control; including that the
Private Placement is not attractive to investors for any reason; that regulators or other factors slow
down our intended timing; and exploration costs may increase dramatically or have been
underestimated for the size and scope of the project. Red Oak disclaims any obligation to update or
revise any forward looking statements, whether as a result of new information, events or otherwise,
except as required by law.
Not for distribution to United States newswire services or for release publication, distribution or
dissemination directly, or indirectly, in whole or in part, in or into the United States.
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