Vancouver, Canada - Redstar Gold Corp. (TSX.V: RGC) ("Redstar" or the "Company") provides an update on the option agreement dated January 24, 2014 (the "Option Agreement") with True Grit Resources Ltd. ("True Grit"), whereby Redstar granted True Grit the option to acquire a 100% interest in certain claim blocks located in Nevada, U.S.A. (the "Property").
To complete its first year commitments under the Option Agreement, True Grit was required, among other things, to (i) pay Redstar an additional $50,000; (ii) issue to Redstar an additional 500,000 common shares in its capital; and (iii) incur $250,000 in eligible exploration expenditures on the Property, all on or before February 20, 2015 (the "Deadline"). These commitments were not met by the Deadline. On February 25, 2015, Redstar gave True Grit a notice of default on account of its failure to comply with the terms of the Option Agreement and gave True Grit 60 days to remedy the default. As of the close of business on April 24, 2015, True Grit was still in default of the Option Agreement and on April 25, 2015, Redstar gave True Grit a final extension until the close of business on May 8, 2015 to remedy its default under the Option Agreement, failing which the Option Agreement would be terminated. Additionally True Grit has failed to deliver to Redstar Gold on, or before, March 31, 2015 a report describing the results of True Grit's work done on the Property in 2014.
By the close of business on May 8, 2015, True Grit had paid Redstar $50,000 and issued 500,000 common shares to Redstar, but had not provided Redstar with a particularized summary of approved exploration expenditures incurred on the claim-blocks comprising the Property broken down by category of approved expenditure as set out in the Option Agreement. True Grit has given notice to Redstar that it believes that it has complied with its outstanding expenditure obligations under the Option Agreement, which assertion Redstar disputes.
The Option Agreement provides for binding arbitration on matters with respect to the accounting of monies required to be expended by True Grit thereunder. Accordingly, Redstar intends to submit the issue of whether True Grit complied with its obligation to incur $250,000 in approved exploration expenditures on the Property by February 20, 2015 to arbitration. Pending the conclusion of the arbitration proceedings, Redstar is reviewing its strategy for its Nevada property portfolio, including seeking new partners.
About Redstar Gold Corporation
Redstar is a junior exploration company focused on high-grade gold exploration in North America. In Alaska, the Company is exploring the high-grade Unga Gold Project which was initially acquired in 2011. The Unga Gold Project contains several high grade gold/silver vein systems, two of which Apollo & Sitka were sites of historic high-grade gold production. At Unga, a 1,450 metre, eight hole, first phase diamond drill program is currently underway.
Redstar also owns 30% of the Newman Todd Gold project, in Red Lake, Ontario, Canada and 100% of 10 properties in Nevada. Newman Todd is a high-grade gold discovery along a 1.8 km corridor within the Newman Todd Structure (NTS). The gold mineralization in the NTS remains open along strike and at depth.
Redstar Gold Corporation (RGC: TSX.V)
Ken Booth, President and CEO
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Redstar Gold Corp.
Paul Durham, Investor Relations
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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.
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