Post by
Goldnboy1 on Oct 17, 2011 1:23pm
News
Proposed Qualifying Transaction --->@NEWS RELEASE
REDQUEST CAPITAL CORP ("RQM.P-V")
- Proposed Qualifying Transaction
RedQuest Capital Corp. ("RedQuest"), is pleased to announce that it
has entered into a binding letter of intent dated October 11, 2011 (the
"LOI") with Polar Star Mining Corporation ("Polar Star") (TSX: PSR) to
acquire up to a 75% interest in Polar Star's Los Azules property located
approximately 65 km east of the city of Copiapo, Region III, Chile (the
"Transaction"). The Transaction is intended to be effected through a formal
option, earn-in and joint venture agreement (the "Agreement"). The
Transaction will be an arm's length transaction and is intended to serve as
RedQuest's Qualifying Transaction pursuant to Policy 2.4 of the TSX Venture
Exchange (the "Exchange") Corporate Finance Manual ("Exchange Manual"). On
completion of the Qualifying Transaction, RedQuest will be a mining issuer.
The Proposed Transaction
Pursuant to the LOI, the First Option requires RedQuest to complete
C$3.9 million in work commitments on the Property over a period of three
years and to make cash payments over approximately the same period totaling
C$350,000 to earn a 51% interest in the Property. RedQuest will also grant
Polar Star a one percent Net Smelter Return ("NSR") upon earning the 51%
interest and will then have 90 days to make a onetime election to purchase
half of the one percent NSR for US$500,000 in cash. The one percent NSR is
capped at a maximum of US$5,000,000. Upon exercise of the First Option,
Polar Star and RedQuest shall be deemed to have formed a joint venture
arrangement ("Joint Venture") with Polar Star holding a 49% interest in and
to the Property and RedQuest holding a 51% interest in and to the Property.
Under the Second Option, RedQuest will earn an additional 10% interest
in the Property, giving RedQuest an aggregate 61% interest, by delivering a
Preliminary Economic Assessment to Polar Star. Under the Third Option,
RedQuest will earn an additional five percent interest in the Property,
giving RedQuest an aggregate 66% interest, by delivering a Prefeasibility
Study. Under the fourth option, RedQuest will earn an additional nine
percent interest in the Property, giving RedQuest an aggregate 75%
interest, by delivering a Feasibility Study.
In connection with the Qualifying Transaction, RedQuest intends to
complete a private placement carried out in connection with the Transaction
(the "Financing"). The First Option is exercisable for a period of three
years commencing from the date of completion of the Financing by RedQuest
(the "Financing Date") and each of the Second, Third and Fourth options
will be exercisable for a period of five years commencing on the third
anniversary of the Financing Date. The details of the Financing will be
announced in a subsequent press release.
"We are very pleased to acquire the Los Azules option from Polar
Star," states Brian P. Fowler, P.Geo., President and CEO of RedQuest. "Upon
Exchange approval, RedQuest intends to complete a financing and embark upon
an aggressive exploration program on the property."
To date, RedQuest has not been provided by Polar Star with audited and
unaudited financial statements relating to the Los Azules property.
Conditions
The completion of the Qualifying Transaction and the entering into of
the Agreement will be subject to certain conditions precedent, including,
but not limited to: (i) obtaining all requisite corporate, shareholder,
regulatory, Exchange or governmental authorizations and consents for
implementation of the Transaction; (ii) completion of all technical, legal
and financial due diligence; (iii) completion of the Financing within 150
days from the date of the LOI; (iv) completion by Polar Star of a NI 43-101
Technical Report on the Property within 30 days of the LOI; (v) payments
made by Polar Star in connection with the underlying option; and (vi)
certain other conditions typical in a transaction of this nature.
Sponsorship Requirements/Regulatory Requirements
The Exchange may require RedQuest to retain a sponsor to provide a
sponsorship report to the Exchange in respect of the Transaction (the
"Sponsor"). The Sponsor may need to prepare and file a Sponsorship
Acknowledgement Form pursuant to the Exchange Manual. Prior to the
completion of the Qualifying Transaction, RedQuest must submit for review
to the Exchange a filing statement or information circular which must
contain full, true and plain disclosure of all material facts relating to
the particular matters to be acted upon by its shareholders, including the
Transaction. Polar Star agrees to make available to RedQuest prospectus
level disclosure with respect to Polar Star and the Property, including
financial statements, and after reviewing the filing statement, agrees to
certify that the information in the filing statement with respect to Polar
Star and the Property constitutes full, true and plain disclosure.
About Los Azules
The 2,384 hectare Los Azules property is comprised of 16 exploration
and exploitation concessions covering the historic Los Azules high-grade
copper-gold mining district. The road accessible property is located 65 km
east of the city of Copiapo in the Atacama Region of northern Chile.
The property is underlain by the Late Cretaceous Cabaca de Vaca
batholith which is intruded by numerous hydrothermal collapse breccia pipes
containing copper, uranium and molybdenum mineralization. The individual
pipes range from five metres to 350 metres in diameter and at least four
are over several hundred metres in diameter. The largest of these pipes
(the "Araya Breccia") is some 1,100 metres long, averages 150 metres in
width, and is oxidized to a depth of 150 metres. In this region of Chile,
the average total copper grade of similar types of breccias using bulk
mining techniques is typically in the 0.7% to 1.0% range.
Starting in 2007, Polar Star focussed much of its exploration effort
on defining the numerous breccia pipes on the property. Work included
property-wide prospecting, geological mapping, bulk sampling, and a 2,100
metre diamond drilling program targeting the oxidized upper 100 metres of
the Araya Breccia. The drilling program returned intercepts ranging from 44
metres of 0.71% total copper to 24 metres grading 1.1% total copper.
In late 2009 through 2010, Polar Star changed its focus to parts of
the property east and north of the Array Breccia. It completed a 41 line-km
IP/Resistivity ground geophysical survey which outlined a moderate to
strong IP chargeability anomaly at least 2.9 km long and up to 1.7 km wide
that underlie the breccias from 100 metres to over 300 metres depth. The
four strongest centres of strong chargeability generally coincide with
mineralized breccias and strong argillic alteration mapped at surface. The
IP chargeability anomaly was tested with a 3,693 metre reconnaissance RC
drilling program where seven holes intersected porphyry-style copper
mineralization.
The preparation of the scientific and technical information referenced
above was carried out under the direction and supervision of Terence
Walker, M.Sc., P.Geo. of Polar Star, a qualified person within the meaning
of National Instrument 43-101. Mr. Walker has reviewed the contents of this
news release. RedQuest has not reviewed the scientific and technical
information and will only do so in connection with the completion of the
Qualified Transaction.
About RedQuest
RedQuest is classified as a Capital Pool Company ("CPC") as defined in
Policy 2.4 of the Exchange Manual. RedQuest's principal business is
identifying, evaluating and acquiring interests in businesses and assets.
Share Capitalization as of October 11 2011
//st
Common Shares Outstanding: 6,550,000
Stock & Agent Options: 955,000
//et
Management Team
After the Qualifying Transaction, Brian P. Fowler will continue as
RedQuest's President, CEO and Director. The other RedQuest Director's are
Guy Le Bel, Andre Le Bel and Darren O'Brien. The following are brief
biographies of the Directors:
Brian P. Fowler - President, CEO and Director
Mr. Fowler has more than 30 years' experience as a mining executive
and exploration geologist on a global basis. From 2005 to 2006, Mr. Fowler
was a mining consultant responsible for the identification and evaluation
of exploration and mining investment opportunities for Quest Capital Corp.
Prior to this, he was Exploration Manager for Quadra Mining Ltd., where he
evaluated and managed a number of advanced and pre-feasibility-level
exploration projects in the United States, Chile and Peru. From 1991 to
2004, Mr. Fowler worked in a variety of technical and managerial roles for
Placer Dome Inc., where he managed a regional exploration office and a
number of advanced stage, feasibility-level projects and evaluations
(Musselwhite, Mt. Milligan, South Deeps) and directed Minex exploration at
a number of internationally located mines. Mr. Fowler is a founding
director and Chairman of Laurentian Goldfields Ltd.
Guy Le Bel - Director
Mr. Le Bel has over 25 years of experience in the mining industry. His
focus is on valuation, financial analysis and strategic and business
planning. He is Vice President, Business Development for QuadraFNX Mining
Ltd. Prior to joining QuadraFNX Mining Ltd., Mr. Le Bel was Corporate
Development Consultant to Inco Ltd.'s Strategic Planning Group. Between
1998 and 2000, he was Manager, Business Valuation with Rio Algom Ltd.
Following the acquisition of Rio Algom by BHP Billiton, Mr. Le Bel became
Senior Business Advisor to BHP Billiton Base Metals. From 1987 to 1998 he
held the positions of Financial Analyst and Manager, Financial Planning
with Cambior Inc. Prior to joining Cambior, Mr. Le Bel worked as a Mining
and Geotechnical Engineer with Golder Associates Ltd. Mr. Le Bel is a
licensed member of L'Ordre des ingAnieurs du QuAbec (OIQ) and a member of
the Prospectors and Developers Association of Canada (PDAC).
Andre Le Bel - Director
Mr. Le Bel has over 15 years of experience in dealing with various
legal aspects of the mining business. Mr. Le Bel is VP Legal Affairs and
Corporate Secretary for Osisko Mining Corporation, listed on the Toronto
Stock Exchange. Prior to November 2007 he was VP Legal Affairs with Iamgold
Corporation from November 2006 to October 2007 and before November 2006, he
was Senior Legal Counsel and Assistant Corporate Secretary of Cambior Inc.
Mr. Le Bel is also a director and a member of the audit committee of
Threegold Resources Inc.
Darren O'Brien - Director
Mr. O'Brien has over 17 years' experience in the mineral exploration
industry. Mr. O'Brien was the former Vice President, Exploration for
Terrane Metals Corp. (acquired by Thompson Creek Metals Company Inc. in
2010). Previous to that, Mr. O'Brien worked for Placer Dome Inc. as Senior
Exploration Geologist in the Strategic Development Group. In this position
he conducted evaluations on advanced stage projects in Central Asia,
Alaska, the Caribbean, and Canada. He played a key role in the development
of the Donlin Creek Project from an early stage exploration project to a
multi-million ounce gold deposit. He has advanced several projects to
positive production decisions, including Pueblo Viejo and Mt. Milligan.
From 1993 to 1996, Mr. O'Brien conducted exploration in the Red Lake Camp,
within and adjacent to the Campbell Mine, which is now a part of Goldcorp
Inc.'s Red Lake Gold Mines Complex. Mr. O'Brien is an Elected Director of
AME BC for the 2011 term.
About Polar Star
Polar Star is an emerging exploration company with a focus on building
value in Chile through discovery and development. Its flagship property,
Montezuma, covers 40 kilometres of the West Fault and the cross-cutting
Esperanza Fault system and is located between Codelco's Radomiro Tomic -
Chuquicamata - Ministro Hales (formerly known as Mansa Mina) group of
copper-molybdenum porphyry deposits, and Antofagasta PLC's El Tesoro -
Esperanza - Polo Sur group of copper-gold porphyry deposits. Polar Star was
formed pursuant to the Canada Business Corporations Act. The head offices
of Polar Star are located in Toronto.
Polar Star currently beneficially owns a 100% interest in 13
exploitation concessions and has an option to acquire a 100% interest in
three other exploitation concessions through its wholly owned subsidiary,
Minera Celeste Chile Ltda. The group of 16 exploitation concessions forms
the mineral property known as "Los Azules".