CSRNF - Canstar Closes $5.2 Million Flow-Through Financing
(TheNewswire)
Toronto, Ontario - TheNewswire – December 8, 2021 – CANSTAR RESOURCESINC. (TSXV:ROX ) & ( OTC:CSRNF) (“ Canstar” or the “Company ”) is pleased to announce that it has completed itspreviously announced non-brokered private placement, consisting of thesale of 14,412,471 flow-through units (each a “FT Unit”) at aprice of $0.315 per FT Unit and 1,724,138 premium flow-through units(each a “Premium FT Unit”, and together with the FT Units, the“Offered Units”) at a price of $0.39 per Premium FT Unit foraggregate gross proceeds of $ $5,212,342.19 (the “Offering”). EachFT Unit is composed of one (1) common share (“Share”) of theCompany issued on a flow-through basis within the meaning of the Income Tax Act (Canada) (the “Tax Act”) and one-half of one (0.5) Sharepurchase warrant (each whole warrant, a "Warrant"). EachWarrant will entitle the subscriber to purchase one (1) additionalShare at a price of $0.42 until the second (2 nd ) anniversaryof the closing date of the Offering (the "ExpiryDate").
The Company will use an amount equal to the grossproceeds received by the Company from the sale of the Offered Units,pursuant to the provisions in the Income Tax Act (Canada) (the “Tax Act”), to incur eligible "Canadianexploration expenses" that qualify as "flow-through miningexpenditures" as both terms are defined in the Income Tax Act (Canada) (the "Qualifying Expenditures") on or beforeDecember 31, 2022, and to renounce all the Qualifying Expenditures infavour of the subscribers of the Offered Units effective December 31,2021. The Company intends to use such proceedsprimarily on the Golden Baie property, located in south Newfoundland,and the Buchan’s-Mary March property in central Newfoundland.
In connection with the closing of the Offering, theCompany paid commissions to certain finders of an aggregate of$286,026.06 in cash and 908,019 finder warrants (each a, “FinderWarrant”). Each Finder Warrant will entitle the holder thereof topurchase one (1) Share at an exercise price of $0.315 per FinderWarrant for a period of 24 months from closing of the Offering.
The Offering is subject to certain conditionsincluding, but not limited to, the receipt of all necessary approvalsincluding the approval of the TSX Venture Exchange (“TSXV”) andthe securities regulatory authorities. All securities issued andissuable in connection with the Offering are subject to a hold periodof four months plus one day.
A certain director of Canstar (the “Insider”)subscribed to the Offering for an aggregate of 158,800 FT Units andthe participation of the Insider in the Offering constitutes a"related party transaction" within the meaning ofMultilateral Instrument 61-101 - Protection of Minority SecurityHolders in Special Transactions ("MI 61-101"). The Companyis relying on an exemption from the formal valuation and minorityshareholder approval requirements of MI 61-101 pursuant to section5.5(a) and section 5.7(1)(a), as the fair market value of theInsider’s participation is not more than 25% of the Company's marketcapitalization.
The securities offered in the Offering have not been,and will not be, registered under the United States Securities Act of1933, as amended (the “U.S. Securities Act”) or any U.S. statesecurities laws, and may not be offered or sold in the United Statesor to, or for the account or benefit of, United States persons, absentregistration or any applicable exemption from the registrationrequirements of the U.S. Securities Act and applicable U.S. statesecurities laws. This news release does not constitute an offer tosell or the solicitation of any offer to buy securities in the UnitedStates, nor in any other jurisdiction.
About Canstar Resources Inc.
Canstar is focused on the discovery and development ofeconomic mineral deposits in Newfoundland and Labrador, Canada.Canstar has an option to acquire a 100% interest in the Golden BaieProject, a large claim package (62,175 hectares) with recentlydiscovered, multiple outcropping gold occurrences on a majorstructural trend in south Newfoundland. The Company also holds theBuchans-Mary March project and other mineral exploration properties inNewfoundland. Canstar Resources is based in Toronto, Canada, and islisted on the TSX Venture Exchange under the symbol ROX and trades onthe OTCPK under the symbol CSRNF.
For further information, pleasecontact:
Rob Bruggeman P.Eng., CFA
President & CEO
Email: rob@canstarresources.com
Forward-Looking Statements
Neither TSX Venture Exchange nor itsRegulation Services Provider (as that term is defined in the policiesof the TSX Venture Exchange) accepts responsibility for the adequacyor accuracy of this release.
This News Release includes certain"forward-looking statements" which are not comprised ofhistorical facts. Forward looking statements include estimates andstatements that describe the Company’s future plans, objectives orgoals, including words to the effect that the Company or managementexpects a stated condition or result to occur. Forward lookingstatements may be identified by such terms as “believes”,“anticipates”, “expects”, “estimates”, “may”,“could”, “would”, “will”, or “plan”. Sinceforward-looking statements are based on assumptions and address futureevents and conditions, by their very nature they involve inherentrisks and uncertainties. Although these statements are based oninformation currently available to the Company, the Company providesno assurance that actual results will meet management’sexpectations. Risks, uncertainties and other factors involved withforward-looking information could cause actual events, results,performance, prospects and opportunities to differ materially fromthose expressed or implied by such forward-looking information.Forward looking information in this news release includes, but is notlimited to, the Company’s objectives, goals or future plans,statements, exploration results, potential mineralization, theestimation of mineral resources, exploration and mine developmentplans, timing of the commencement of operations and estimates ofmarket conditions, the completion of the Offering, the anticipated useof the net proceeds from the Offering and the receipt of all necessaryapprovals. Factors that could cause actual results to differmaterially from such forward-looking information include, but are notlimited to failure to identify mineral resources, failure to convertestimated mineral resources to reserves, the inability to complete afeasibility study which recommends a production decision, thepreliminary nature of metallurgical test results, delays in obtainingor failures to obtain required governmental, environmental or otherproject approvals, political risks, inability to fulfill the duty toaccommodate First Nations and other indigenous peoples, uncertaintiesrelating to the availability and costs of financing needed in thefuture, changes in equity markets, inflation, changes in exchangerates, fluctuations in commodity prices, delays in the development ofprojects, capital and operating costs varying significantly fromestimates and the other risks involved in the mineral exploration anddevelopment industry, an inability to complete the Offering on theterms or on the timeline as announced or at all, an inability topredict and counteract the effects of COVID-19 on the business of theCompany, including but not limited to the effects of COVID-19 on theprice of commodities, capital market conditions, restriction on labourand international travel and supply chains, and those risks set out inthe Company’s public documents filed on SEDAR. Although the Companybelieves that the assumptions and factors used in preparing theforward-looking information in this news release are reasonable, unduereliance should not be placed on such information, which only appliesas of the date of this newsrelease, and no assurance can be given that such events will occur inthe disclosed time frames or at all. The Company disclaims anyintention or obligation to update or revise any forward-lookinginformation, whether as a result of new information, future events orotherwise, other than as required by law. Canstar is focused on the discovery anddevelopment of economic mineral deposits in Newfoundland and Labrador,Canada. Canstar has an option to acquire a 100% interest in the GoldenBaie Project, a large claim package (62,175 hectares) with recentlydiscovered, multiple outcropping gold occurrences on a majorstructural trend in south Newfoundland. The Company also holds theBuchans-Mary March project and other mineral exploration properties inNewfoundland. Canstar Resources is based in Toronto, Canada, and islisted on the TSX Venture Exchange under the symbol ROX and trades onthe OTCPK under the symbol CSRNF.
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