Rio Silver Advances with Sale Agreement and Share Consolidation Plan
Rio Silver Inc. Completes Strategic Sale Agreement
Rio Silver Inc. has finalized a significant agreement with Magma Silver Corp. concerning the Niñobamba Au-Ag property, marking a pivotal move for the company in enhancing its potential. As detailed in their recent announcement, the company has entered into an Option Agreement that grants Magma Silver the right to acquire up to a 100% interest in the property, showcasing Rio Silver's strategic approach to asset management.
Terms of the Sale Agreement
According to the terms set forth in the Option Agreement, Magma Silver is required to make payments totaling CAD$260,000, with CAD$160,000 already paid. The agreement outlines further payments that could total US$2,000,000, which includes advanced royalty payments. These payments highlight the robust financial structure of the deal, allowing Rio Silver to benefit significantly from the proceeds.
In addition to the cash payments, Magma Silver has committed to issuing 2,500,000 common shares to Rio Silver upon receiving regulatory approval, with another 2,500,000 shares to follow on the first anniversary of that approval. This provision not only strengthens the financial position of Rio Silver but also solidifies its stake in the project's future success.
Planned Share Consolidation
Rio Silver has also announced plans for a share consolidation on a one-new-for-five-old basis, contingent upon regulatory approval. This consolidation is aimed at streamlining the company's capital structure. Following this consolidation, the number of outstanding shares will diminish from approximately 99.8 million to about 19.97 million. The intention behind this move is to enhance share value and appeal to potential investors.
The adjustments to outstanding stock options and convertible instruments will be proportionately made, ensuring that all shareholders are treated fairly during this transition. As part of this process, the company plans to send out instructions to shareholders on how to exchange their certificates for new ones reflecting their post-consolidation ownership.
Focus on Growth and Future Projects
This strategic transaction alongside the share consolidation is designed to allow Rio Silver to concentrate more on its recently-acquired Maria Norte project. This high-grade silver exploration project located in a dynamic mining district signals a commitment to pursuing profitable ventures that suit the company's long-term vision.
Furthermore, by aligning these strategies, Rio Silver is positioning itself to leverage significant growth opportunities within the precious and base metals sectors. The focus remains on finding operational efficiencies that can lead to cash flow and ultimately increase shareholder value.
About Rio Silver Inc.
Rio Silver is a Canadian exploration and development company that is dedicated to its projects in Peru and Ontario. With a considerable proportion of insider ownership, it continues to evaluate and acquire promising properties that indicate potential for profitable production. The company's forward-thinking approach facilitates opportunities that align with its strategic goals in a resource-rich environment.
For additional information about Rio Silver, feel free to contact:
Christopher Verrico, President, CEO
Phone: (604) 762-4448
Email: chris.verrico@riosilverinc.com
Website: www.riosilverinc.com
Frequently Asked Questions
What is the significance of the sale agreement with Magma Silver?
This agreement allows Rio Silver to secure immediate funding and shares, enabling further investment in its projects.
How will the share consolidation affect existing shareholders?
Shareholders will receive new shares on a 1-for-5 basis, adjusting their ownership but potentially enhancing share value.
What is the Maria Norte project?
Maria Norte is a high-grade silver exploration project located in Peru, offering great potential for future development.
What are the expected benefits of the consolidation?
The consolidation aims to streamline share structure, potentially increase share prices, and attract more investors.
How can I contact Rio Silver for more details?
You can reach out to Christopher Verrico through email or phone, as listed above, for more information on their operations and recent news.
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