Goldstar Announces Private Placement, Share Consolidation, and Debt Settlement
10 July 2020 - 2:27AM
Goldstar Minerals Inc. (“
Goldstar” or the
“
Corporation”)
(TSX-V: GDM) is
pleased to announce that it intends to complete a $1.3 million
private placement, a ten (10) to one (1) share consolidation and a
share for debt transaction with an insider of the Corporation to
settle a debt of $500,000.
Private Placement
Subject to the approval of the TSX Venture
Exchange (the “Exchange”), the Corporation intends
to proceed to a non-brokered private placement offering (the
“Offering”) for aggregate gross proceeds of a
maximum of $1.3 million. The Offering will be comprised of up to
35,000,000 units (each, a “Unit”) and up to
30,000,000 flow-through common shares (each, a
“Flow-Through Share”), each of the Units and the
Flow-Through Shares to be offered separately at a price of $0.02 on
a pre-consolidation basis.
The pricing of the Offering is in reliance of
the Temporary Relief Measures of the $0.05 Minimum Pricing
Requirement (the “Temporary Relief Measures”)
established by the TSX Venture Exchange (the
“Exchange”) on April 8, 2020. In response to the
COVID-19 pandemic, the Exchange published the Temporary Relief
Measures, lowering the minimum price from $0.05 to $0.01 per share
for shares issued pursuant to a private placement or for shares
issued for debt, where the market price of an issuer’s shares is
not greater than $0.05. The Corporation will seek to utilize such
Temporary Relief Measures.
Each Unit will be comprised of one common share
in the capital of the Corporation and one common share purchase
warrant (each, a “Warrant”). Each Warrant will
entitle the holder thereof to purchase one additional common share
of the Corporation at an exercise price of $0.03 per common share
on a pre-consolidation basis, for a period of eighteen (18) months
from the date of closing of the Offering (the “Closing
Date”).
Each Flow-Through Share will consist of one
common share of the Corporation to be issued as a “flow-through
share” as defined in the Income Tax Act (Canada).
The proceeds from the issuance of the Units will
be used by the Corporation to provide working capital for general
corporate purposes. The proceeds from the issuance of the
Flow-Through Shares will be used to incur Canadian Exploration
Expenses on the Anctil and Nemenjiche properties of the
Corporation.
In respect of subscriptions sourced by an
eligible finder (the “Finder”), the Corporation
will pay a fee to the Finder as follows: (i) in respect of
subscriptions for Units, the Corporation will pay a cash fee of 8%
of the amount subscribed. In addition, the Corporation will issue
to the Finder on the Closing Date a warrant (a “Finder’s
Warrant”) entitling the Finder to acquire, at a
subscription price of $0.02 each, a number of Units equal to 8% of
the number of Units subscribed, each Finder’s Warrant expiring 18
months from the Closing Date; and (ii) in respect of subscriptions
for Flow-Through Shares, the Corporation, at its option, will
either pay a cash fee of 8% of the amount subscribed or issue to
the Finder a number of Units equal to 8% of the number of
Flow-Through Shares subscribed.
Closing of the Offering is subject to all
applicable regulatory approvals, including the approval of the
Exchange.
All securities to be issued pursuant to the
Offering will be subject to a four month hold period commencing on
the Closing Date, in accordance with applicable Canadian securities
laws, in addition to any other restrictions applicable under the
policies of the Exchange or securities laws of jurisdictions
outside Canada where the securities are sold.
Share Consolidation
The Corporation intends to consolidate its
outstanding shares on the basis of one (1) post-consolidation
common share for every ten (10) pre-consolidation common shares.
The Corporation intends to hold its next annual general meeting of
shareholders in December 2020 and to seek shareholder approval for
the share consolidation at such meeting.
As of the date hereof, the Corporation has
113,179,312 common shares outstanding. Assuming the private
placement is fully subscribed, the Corporation
would have 178,179,312 pre-consolidation common shares issued and
outstanding and, upon completion of the share consolidation, the
Corporation would have 17,817,931 post-consolidation common shares
issued and outstanding.
Debt Settlement
An insider of the Corporation has agreed to
accept 2,500,000 common shares of the Corporation at a price of
$0.20 per share on a post-consolidation basis (corresponding to
25,000,000 common shares at a price of $0.02 per share on a
pre-consolidation basis) in settlement of the debt in the amount of
$500,000 owed to him by the Corporation. The debt settlement is
subject to the completion of the share consolidation and the
approval of the Exchange. The common shares issued pursuant to the
debt settlement will be subject to a four month hold period
commencing on the date of issue.
For further information, please contact:
David CrevierChairmanTelephone:
514-284-3663dcrevier@goldstarminerals.com
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. This news release may contain
forward-looking statements. These statements are based on current
expectations and assumptions that are subject to risks and
uncertainties. Actual results could differ materially because of
factors discussed in the management discussion and analysis section
of our interim and most recent annual financial statement or other
reports and filings with the TSX Venture Exchange and applicable
Canadian securities regulations. We do not assume any obligation to
update any forward-looking statements, except as required by
applicable laws.
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