Part & Parcel

Sep 3, 2020

Canstar Amends Terms of Private Placement THIS NEWS RELEASE IS NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO U.S. NEWS AGENCIES TORONTO, Sept. 02, 2020 (GLOBE NEWSWIRE) — CANSTAR RESOURCES INC. (TSXV: ROX) (“Canstar Resources” or the “Company”) announces that, further to its press release dated August 26, 2020, it is amending the terms (the “Amendment”) of its proposed non-brokered private placement for aggregate gross proceeds of up to $2,000,000 (the “Offering”).Pursuant to the Amendment, Canstar Resources intends to complete the Offering in two tranches. The first tranche will consist of the sale of up to 4,761,905 units (“Part & Parcel Units”) at a price of $0.105 per Part & Parcel Unit, for gross proceeds of up to $500,000. Each Part & Parcel Unit will be comprised of one common share in the equity of the Company (each, a “Common Share”) and one Common Share purchase warrant (each, a “Part & Parcel Warrant”). Each Part & Parcel Warrant will entitle the subscriber to purchase one additional Common Share at a price of $0.14 until the second (2nd) anniversary of the closing date of the Offering.The second tranche will consist of the sale of up to 9,523,810 units (“Regular Units”) at a price of $0.1575 per Regular Unit, for gross proceeds of up to $1,500,000. Each Regular Unit will be comprised of one Common Share and one Common Share purchase warrant (each, a “Regular Warrant”). Each Regular Warrant will entitle the subscriber to purchase one additional Common Share at a price of $0.21 until the second (2nd) anniversary of the closing date of the Offering.The Company intends to use the net proceeds raised from the Offering for general corporate purposes, working capital, and exploration expenses on the Company’s properties, including Buchan’s/Mary March, Daniel’s Harbour, and Golden Baie. In particular, the proceeds from the sale of Part & Parcel Units will be used to fund the exploration expenditure commitment on the Golden Baie project, subject to the approval of the TSX Venture Exchange and the closing of this transaction as announced on August 26, 2020.The Company may pay finder’s fees in respect to the Offering. Closing of the Offering is expected on or about September 15, 2020. The Offering is subject to the final approval of the TSX Venture Exchange. Securities issued pursuant to the Offering shall be subject to a four-month plus one day hold period commencing on the day of the closing of the Offering under applicable Canadian securities laws.It is expected that certain directors, officers and other insiders of the Company (collectively, the “Insiders”) will participate in the Offering. The participation of Insiders in the Offering constitutes a “related party transaction”, as such terms are defined by Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company is relying on an exemption from the formal valuation requirements of MI 61-101 available on the basis of the securities of the Company not being listed on specified markets, including the Toronto Stock Exchange, the New York Stock Exchange, the American Stock Exchange, the NASDAQ or certain overseas stock exchanges. The Company is also relying on the exemption from minority shareholder approval requirements under MI 61-101 as the fair market value of the participation in the Offering by the Insiders does not exceed 25% of the market capitalization of the Company.The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.About Canstar Resources Inc.Canstar Resources is a mineral exploration and development company focused on creating shareholder value through discovery and development of economic mineral deposits in Newfoundland, Canada. Canstar is in the process of completing option agreements on the Golden Baie Project in south Newfoundland, a large claim package (660 km2) with recently discovered, multiple outcropping gold occurrences. The Company also holds the Buchans-Mary March project and other mineral exploration properties in Newfoundland and Labrador, Canada. Canstar Resources is based in Toronto, Canada and is listed on the TSX Venture Exchange and trades under the symbol ROX-V.For further information, please contact:Dennis H. Peterson Chairman of the Board, Interim President and Chief Executive Officer Forward-Looking StatementsNeither 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 includes certain “forward-looking statements” which are not comprised of historical facts. Forward-looking statements include estimates and statements that describe the Company’s future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as “believes”, “anticipates”, “expects”, “estimates”, “may”, “could”, “would”, “will”, or “plan”. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Although these statements are based on information currently available to the Company, the Company provides no assurance that actual results will meet management’s expectations. Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but is not limited to, the Company’s objectives, goals or future plans, statements, exploration results, potential mineralization, the estimation of mineral resources, exploration and mine development plans, timing of the commencement of operations and estimates of market conditions, as well as the anticipated size of the Offering, the Offering price, the anticipated closing date and the completion of the Offering, the anticipated use of the net proceeds from the Offering, the closing of the Golden Baie property transaction on the terms as announced or at all, and the receipt of all necessary approvals. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to failure to identify mineral resources, failure to convert estimated mineral resources to reserves, the inability to complete a feasibility study which recommends a production decision, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, inability to fulfill the duty to accommodate First Nations and other indigenous peoples, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects, capital and operating costs varying significantly from estimates and the other risks involved in the mineral exploration and development industry, an inability to complete the Offering on the terms or on the timeline as announced or at all, an inability to predict and counteract the effects of COVID-19 on the business of the Company, including but not limited to the effects of COVID-19 on the price of commodities, capital market conditions, restriction on labour and international travel and supply chains, and those risks set out in the Company’s public documents filed on SEDAR. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.