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Silk Road Resources Ltd. Announces Proposed Private Placement

^{Published on 2009-05-19 18:25:49, Last Modified on 2009-05-19 18:26:57 - Market Wire}
 

 TORONTO, May 19 /CNW/ - Silk Road Resources Ltd. ("Silk Road" or the "Company") (TSXV: SIL) announces that it is proposing to complete a non-brokered private placement of up to 1,400,000 units of the Company (the "Units") at a price of $0.25 per Unit for aggregate gross proceeds of up to $350,000. Each Unit will be comprised of one common share in the capital of the Company and one common share purchase warrant. Each common share purchase warrant will entitle the holder thereof to acquire one common share at a price of: - $0.26 at any time prior to the date that is 12 months following the date of the closing of the private placement; - $0.30 at any time after 12 months but before 24 months following the date of the closing of the private placement; or - $0.35 at any time after 24 months but before 36 months following the date of the closing of the private placement. It is anticipated that the Units will be subscribed for by Robert Power, Chairman of the Company, as to 1,000,000 Units and Anthony Patriarco, a director of the Company, as to 400,000 Units. Since both Mr. Power and Mr. Patriarco are insiders of the Company, the private placement will be a "related party transaction" for the purposes of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Company will rely on the exemptions from the formal valuation and minority approval requirements of MI 61-101 contained in section 5.5(a) and section 5.7(a), respectively, of MI 61-101 as neither the fair market value of the subject matter of, nor the fair market value of the consideration for, the private placement will exceed 25% of the Company's market capitalization. The private placement is subject to the approval of the TSX Venture Exchange. The private placement is expected to close on or about May 22, 2009. The Company intends to use the proceeds of the private placement for general working capital purposes for the period until it completes its previously announced business combination with EurOmax Resources Limited ("EurOmax"). 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: please contact David Bell, CEO of Silk Road at (416) 624-8794