Salazar Provides Update on its Recapitalization Plan
VANCOUVER, BRITISH COLUMBIA - SALAZAR RESOURCES LTD. (TSX.V: SRL; FSE: CCG) (the “Company”) – Mr. Fredy Salazar is pleased to provide this update on the Company’s recapitalization plan first announced on April 6th 2016 and then updated on April 27th 2016.
The Company has completed the first two elements of its recapitalization plan with the closing on April 27th 2016 of the private placement and debt settlement transactions. As a result of the private placement the Company welcomed Resource Capital Fund VI L.P (“RCF VI”) to its share registry. The Company and RCF VI have now agreed upon a work program to be implemented on closing of the Royalty Sale. As a result of this agreement on the work program the Company will not be amending the terms of the warrants issued to RCF VI on closing of the Private Placement.
The third part of the recapitalization plan involves the sale of a 2% net smelter returns royalty (“NSR”) interest in its Curipamba project for US$4,750,000 (the “Royalty Sale”). The Royalty Sale is being completed in two tranches of 1% for US$2,375,000, with closing of each tranche being subject to satisfaction of conditions precedent. The Company had announced that closing of the first tranche of the Royalty Sale was expected at the end of May; however, due to the complexity of the transaction with multi-jurisdictional corporate and tax issues to address, the closing has been delayed and is currently not expected until late June. The Company is working with RCF VI to finalize and close on the first tranche of the royalty sale as soon as possible. There remain a number of contractual matters to be finalized to ensure the transaction is properly implemented. Said Mr. Fredy Salazar “We look forward to finalizing the Royalty Sale and to immediately begin work on the approved work programs. With the proceeds from the first tranche closing of the royalty sale we have planned a drill program of 10,000 meters.”
About Salazar Resources Limited
Salazar Resources Ltd. is a publicly-listed (TSX.V: SRL; FSE: CCG) mineral resource company engaged in the exploration and development of new highly-prospective areas in Ecuador. Led by a senior Ecuadorian management team and most notably by its namesake Fredy Salazar, this team has been instrumental in other major discoveries throughout Ecuador. Being based in Ecuador, thus having thorough knowledge of local human and environmental issues, gives the company a strategic advantage, enabling it to complete exploration at a rapid pace. With an excellent property portfolio (3 projects- 42,900 hectares), good geopolitical positioning and a number of strategic corporate and financial partnerships, Salazar has positioned itself to be a strategic player in Ecuador and throughout South America.
ON BEHALF OF THE BOARD OF SALAZAR RESOURCES LIMITED
President & CEO
Salazar Resources Limited
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Salazar Resources Ltd.
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This press release contains “forward-looking information” within the meaning of applicable Canadian securities laws. All statements included herein, other than statements of historical fact, are forward-looking information and such information involves various risks and uncertainties. Forward-looking information herein includes, but is not limited to, statements that address activities, events or developments that the Company expects or anticipates will or may occur in the future, including such things as the successful completion of the Additional Royalty Sale. Such forward-looking information is based on a number of material factors and assumptions, including that the Company will be able to satisfy the conditions precedent to closing of such transaction. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information. A description of assumptions used to develop such forward-looking information and a description of risk factors that may cause actual results to differ materially from forward-looking information can be found in the Company's disclosure documents on the SEDAR website at www.sedar.com. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward- looking information except in accordance with applicable securities laws.