Vancouver BC, Redstar Gold Corp (TSX.V:RGC) ("Redstar" or the "Company"). Pursuant to the terms of an Assignment and Novation Agreement entered into among the Company, Full Metal Minerals (USA) Inc. ("Full Metal"), a wholly-owned subsidiary of Full Metal Minerals Ltd. (TSX.V:FMM), and The Aleut Corporation ("TAC") (the "Assignment Agreement") as disclosed in the Company's news release of October 30, 2014, the Company reports that it has agreed to assume the obligations of Full Metal under an Amended and Restated Exploration Agreement with Option to Lease Originally Effective as of January 5, 2007, and, as Amended and Restated Effective as of June 30, 2010, between TAC and Full Metal (the "Agreement") and as further modified by the Assignment Agreement.
Pursuant to the rights and interests held by Full Metal under the Agreement and as modified and assigned to the Company, the Company has agreed to pay to TAC an initial option payment in the amount of US$135,000 and later option payments totaling US$175,000 over three years, as well as annual Materials Payments in the amount of US$20,000. Additionally, the Company will incur annual exploration expenditures totaling US$3,400,000 over four years.
The Agreement provides that the Company may enter into a Mining Lease with TAC at any time prior to December 31, 2019. Upon entering into the Mining Lease, the Company will make annual Advance Royalty payments escalating from US$25,000 in the first year to US$400,000 on the 16th anniversary and subsequent years. In the event the Company delivers a Feasibility Study, the Company will issue to TAC 500,000 common shares, subject to the approval of the TSX Venture Exchange. Upon commencement of Commercial Production, the Company will pay to TAC a sliding scale net smelter returns royalty of 2% to 5%, depending on the price of gold, and a 2.5% net smelter returns royalty for all commodities except gold and other precious metals.
The Assignment Agreement and the transactions contemplated thereunder are subject to approval by the TSX Venture Exchange.
About Redstar Gold Corp.
Redstar is a Vancouver based junior exploration company focused on high-grade gold exploration in North America. Each of Redstar and Confederation Minerals Ltd. (TSX.V:CFM) owns 50% of the Newman Todd Project, located in Red Lake, Ontario, Canada. In Alaska, the Company is exploring the high-grade Unga Project, which it acquired initially in 2011. At Unga, a comprehensive exploration program commenced in late July, 2014 and results are expected to be used to determine drill targets for a first phase diamond drill program. Additionally, the Company has ten properties in Nevada, which have been optioned to True Grit Resources Ltd. (NEX:TGI.H).
Jesse C. Grady, MSc, CPG-11592, the Company's Vice President of Exploration and a qualified person within the meaning of National Instrument 43-101, has reviewed and approved the technical content of this news release.
On Behalf of the Board,
Redstar Gold Corp.
President and CEO
800 WEST PENDER STREET
Redstar Gold Corp.
Paul Durham, Investor Relations
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.