Sprott Resource Corp. Announces Completion of High Desert Gold Corporation IPO and Comments on Remedial Review Process Initiated by TSX
/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/ TORONTO, Oct. 17 /CNW/ - (TSX: SCP) - Sprott Resource Corp. ("SRC") announces the completion by High Desert Gold Corporation ("High Desert") of its initial public offering (the "Offering") of 30,000,000 units ("Units"), at a price of CDN$ 0.50 per Unit (the "Issue Price"). Each Unit is comprised of one Common Share of High Desert and one half of one Common Share purchase warrant (each whole Common Share purchase warrant being a "Warrant"), with each Warrant entitling the holder to purchase an additional Common Share at a price of CDN$ 0.65 per Common Share until October 17, 2009. Immediately prior to the completion of the Offering, High Desert was a wholly-owned subsidiary of SRC. Following the closing of the High Desert Offering, SRC's interest in High Desert, through its holding of 6 million common shares, has been diluted to approximately 16.67%, thereby preventing SRC from using High Desert's assets to meet its TSX listing requirements. As a result, TSX has notified SRC that it will be reviewing SRC's listing under its remedial review process. SRC has 120 days to comply with all requirements for continued listing, including ownership of, or an option to earn, a minimum 50% interest in a property that demonstrates mineralization in three dimensions at economically interesting grades. The TSX will assess the property based on a current National Instrument 43-101 compliant report that must contain a minimum recommended work program of at least $750,000. "We are currently in advanced negotiations on a number of properties and are confident that we will acquire an interest in a qualifying property that will enable Sprott Resource Corp. to meet the TSX listing requirements well in advance of the 120 day deadline set by TSX." states Kevin Bambrough, President and CEO of SRC. About Sprott Resource Corp. SRC is a Canadian based company. The primary purpose of the Corporation is to invest, directly and indirectly, in natural resources. Through acquisitions, joint ventures and other investments, SRC seeks to provide its shareholders with exposure to the natural resource sector for the purposes of capital appreciation and real wealth preservation. The Corporation is well positioned to draw upon the considerable experience and expertise of both its Board of Directors and Sprott Consulting Ltd. (SCL), a wholly-owned subsidiary of Sprott Asset Management Inc. (SAM). Pursuant to a management services agreement between SCL and SRC, SCL provides day-to-day business management for SRC as well as other management and administrative services. Forward Looking Statements Certain statements regarding SRC, including management's assessment of future plans, may constitute forward-looking statements under applicable securities laws and necessarily involve risk, including without limitation, risks associated with an inability to acquire an interest in a property that is satisfactory to TSX. SRC's actual results or achievements could differ materially from those expressed in, or implied by, the forward-looking statements. No assurance can be given that any events anticipated by the forward-looking statements will occur. These forward-looking statements, which are based on management's current expectations, are made as at the date of this news release. SRC does not undertake any obligation to publicly update or revise any of these forward-looking statements, except as required by applicable securities laws.