Southern Empire Acquires Remaining 25% Interest in Oro Cruz Gold Project
TheNewswire - June 26, 2020 - Southern Empire Resources Corp. ("Southern Empire") (TSXV:SMP) (Frankfurt:5RE) is pleased to announce that it has consolidated its interest in the Oro Cruz Gold Project by entering into an option agreement (the "Option Agreement") with its Chairman, Ronald Netolitzky, which allows Southern Empire to acquire the remaining 25% interest in the Oro Cruz Property.
Highlights of the Transaction
- Southern Empire can now acquire a 100% interest in the Oro Cruz Gold Project.
- Option acquisition price for the remaining 25% is CAD $440,000, which is Mr. Netolitzky's cost.
"Southern Empire now has the ability to consolidate a 100% interest in the Oro Cruz Gold Project after all underlying option agreements are exercised. We are very grateful to Ron for providing us the opportunity to acquire this remaining 25% interest not only at no increase to his original acquisition cost, but also over a 3-year time period. Given the historical, high-grade gold values encountered at Oro Cruz, we view it as one of the pre-eminent exploration and development gold projects in the southwestern United States" stated Dale Wallster, CEO of Southern Empire.
Terms of the Transaction
Pursuant to the terms of the Option Agreement, Southern Empire may acquire the remaining 25% interest in the Oro Cruz Property by paying a total of CAD $440,000 to Mr. Netolitzky as follows:
- CAD $140,000 on receipt of TSX Venture Exchange approval,
- CAD $100,000 on the first anniversary,
- CAD $100,000 on the second anniversary, and
- CAD $100,000 on the third anniversary.
Southern Empire may, at its sole option, satisfy the option payments by the issuance of common shares at the five-day volume weighted average price prior to the issuance of such shares.
Mr. Netolitzky, Chairman and a director, is a related party to Southern Empire. As a result, the transaction is subject to Multilateral Instrument 61-101 - Protection of Minority Holders in Special Transactions. The transaction was reviewed and unanimously approved by Southern Empire's Board of Directors. The acquisition will be exempt from the formal valuation and minority approval requirements of Multilateral Instrument 61-101 - Protection of Minority Holders in Special Transactions as the fair market value of the transaction and the consideration paid will not exceed 25% of Southern Empire's market capitalization.
The Option Agreement is subject to acceptance by the TSX Venture Exchange.
Qualified Person (QP)
The scientific and technical information contained in this news release has been prepared, reviewed, verified and approved by David Tupper, P.Geo. (British Columbia), Southern Empire's VP of Exploration and a Qualified Person within the context of Canadian Securities Administrators' National Instrument 43-101; Standards of Disclosure for Mineral Projects.
About Southern Empire Resources Corp.
Southern Empire is focused on the acquisition, exploration and development of gold deposits in North America, currently having two projects in the American southwest.
In the Cargo Muchacho mountains of Imperial County, southeast California, Southern Empire's 2,160 hectare (5,338 acre) Oro Cruz Gold Project is located approximately 22.5 kilometres (14 miles) southeast of the Mesquite gold mine of Equinox Gold Corp. With a history that includes extensive drilling and large-scale open pit and underground mining that was suspended during the gold market downturn in 1996, the Oro Cruz Property hosts numerous exploration targets in addition to a high-grade oxide gold zone that, based on the historical mine records, is amenable to conventional heap leach extractive methods.
Southern Empire also owns an 85% interest in the 817 hectare (2,020 acre) Eastgate Gold Project, located 81 kilometres (50 miles) southeast of the city of Fallon in Churchill County, Nevada.
At Eastgate, Southern Empire has just completed six HQ-size core drill holes totalling 906 metres (2,972 feet) in a first-pass drill program of the Double Eagle high-grade gold/silver epithermal vein system; one of several steeply dipping, subparallel low-sulphidation, quartz-adularia epithermal vein systems occurring on the property. This drilling was designed to confirm historical Reverse Circulation ("RC") drill assay results reported by past operators of the property and to drill test extensions of known gold mineralization with modest step-out drill holes. All core is now being logged and selective samples are being submitted to ALS USA Inc.'s laboratories in Reno, Nevada. Assay results will be released after they become available and permitting for the next phase of drilling has been initiated.
On behalf of the Board of Directors,
Dale Wallster, CEO and Director
Southern Empire Resources Corp.
Lubica Keighery at (778) 889-5476, email@example.com
Cautionary Notice on Forward-Looking Information
Information set forth in this news release may contain forward-looking statements that are based on assumptions as of the date of this news release. All statements, other than statements of historical fact, that address activities, events or developments that Southern Empire expects or anticipates will or may occur in the future are forward-looking statements that reflect management's current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. Southern Empire cautions that all forward-looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond Southern Empire's control. Such factors include, among other things: risks and uncertainties relating to Southern Empire's limited operating history and the need to comply with environmental and governmental regulations. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, Southern Empire undertakes no obligation to publicly update or revise forward-looking statements or information.
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.