Silk Road Resources Ltd. Announces Closing of Private Placement



    TORONTO, May 26 /CNW/ - Silk Road Resources Ltd. ("Silk Road" or the
"Company") (TSXV: SIL) announces that it has closed the previously announced
non-brokered private placement of 1,400,000 units of the Company (the "Units")
with Robert G. Power Professional Corporation ("RGP") as to 1,000,000 Units
and Patriarco Holdings Limited ("PHL") as to 400,000 Units. Each Unit,
comprised of one common share of the Company and one common share purchase
warrant, was sold for $0.25 for aggregate gross proceeds of $350,000. Each
common share purchase warrant entitles the holder thereof to acquire one
common share for a period of three years from the closing date of the private
placement at a price of: (i) $0.28 in the first year; (ii) $0.30 in the second
year; or (iii) $0.35 in the third year.
    Pursuant to Multilateral Instrument 61-101 - Protection of Minority
Security Holders in Special Transactions ("MI 61-101"), the issuance of the
Units is a "related party transaction" as the respective principals of RGP and
PHL currently each hold, directly or indirectly, 1,000,000 common shares and
5,257,748 common shares, respectively, representing 3.62% and 19.02% of the
issued and outstanding shares of the Company. The Company is exempt from the
formal valuation and minority approval requirements of MI 61-101 contained in
section 5.5(a) and section 5.7(a), as neither the fair market value of the
subject matter of, nor the fair market value of the consideration for the
private placement exceeds 25% of the Company's market capitalization. The
private placement has been accepted by the TSX Venture Exchange.
    The Company intends to use the proceeds from the private placement to
cover preliminary costs in connection with its previously announced business
combination with EurOmax Resources Limited ("EurOmax") and to cover operating
costs and general working capital until the completion of the business
combination. The Company may loan part of the proceeds of the private
placement to EurOmax for its general working purposes for the period until the
business combination is completed.

    Forward Looking Statements:

    Certain information regarding the Company set forth in this press
release, including management's assessment of the Company's future plans and
operations contains forward looking statements that involve substantial known
and unknown risks and uncertainties. These forward looking statements are
subject to numerous risks and uncertainties, some of which are beyond the
Company's and management's control, including but not limited to, the impact
of general economic conditions, industry conditions, fluctuation of commodity
prices, fluctuation of foreign exchange rates, imperfection of reserve
estimates, environmental risks, industry competition, availability of
qualified personnel and management, stock market volatility, timely and cost
effective access to sufficient capital from internal and external sources. The
Company's actual results, performance or achievement could differ materially
from those expressed in or implied by, these forward looking statements and
accordingly, no assurance can be given that any of the events anticipated to
occur or transpire from the forward looking statements will provide any
benefits to the Company.

    
    The TSX Venture Exchange does not accept responsibility for the
    adequacy or accuracy of this release.
    

    %SEDAR: 00012266E




For further information:

For further information: David Bell, CEO of Silk Road at (416) 624-8794

Organization Profile

SILK ROAD RESOURCES LTD.

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