South Star Battery Metals Announces Non-Brokered Private Placement

Rhea-AI Summary

South Star Battery Metals Corp. (TSXV: STS, OTCQB: STSBF) plans a non-brokered private placement to raise approximately C$1,200,000. The offering includes 10,909,091 units priced at C$0.11 each, with each unit comprising one common share and one warrant exercisable at C$0.15 for three years. Proceeds will support land acquisition, materials preparation, and project finance. An acceleration clause may shorten the exercise window for warrants if the share price exceeds C$0.50 for ten consecutive days. The transaction awaits necessary approvals.

Positive

• Plans to raise C$1,200,000 through a private placement.
• Proceeds aimed for land acquisition and project finance.

Negative

• Dependence on market conditions for the success of the private placement.
• Potential dilution of shares due to issuance of new units.

VANCOUVER, BC, Oct. 15, 2021 /PRNewswire/ - South Star Battery Metals Corp. ("South Star" or the "Company") (TSXV: STS) (OTCQB: STSBF), today announces that it intends to complete a non-brokered private placement of units (the "Private Placement" or the "Offering") to raise approximately C$1,200,000.  The closing of the Offering is subject to customary conditions, including the receipt of all necessary approvals, including the approval of the TSX Venture Exchange (the "TSXV").

The Private Placement will consist of 10,909,091 units priced at C$0.11 per unit (the "Units"). Each Unit will consist of one (1) common share and one (1) common share purchase warrant (the "Warrants"). Each Warrant will entitle the holder to purchase one additional common share of the Company at an exercise price of C$0.15 per common share for a period of three years from the date of issue. The securities will be subject to a four-month hold period from the date of closing and approval by the TSXV. The Private Placement is subject to a 15% over-allotment option and to an acceleration clause. See below for further details.

Net proceeds from the Private Placement will be used for land acquisition, advanced materials sample preparation, commercial agreements, project finance and general working capital requirements for the Company.

Acceleration Clause

If during a period of ten consecutive trading days between the date that is four (4) months following the closing of the Private Placement and the expiry of the Warrants the daily volume weighted average trading price of the common shares of the Company on the TSXV (or such other stock exchange where the majority of the trading volume occurs) exceeds C$0.50 on each of those ten consecutive days, the Company may, within 30 days of such an occurrence, give written notice to the holders of the Warrants that the Warrants will expire at 4:00 p.m. (Vancouver time) on the 30th day following the giving of notice unless exercised by the holders prior to such date. Upon receipt of such notice, the holders of the Warrants will have 30 days to exercise their Warrants. Any Warrants which remain unexercised at 4:00 p.m. (Vancouver time) on the 30th day following the giving of such notice will expire at that time.

About South Star Battery Metals Corp.

South Star Battery Metals Corp. is a Canadian battery-metals project developer focused on the selective acquisition and development of near-term production projects in the Americas. South Star's Santa Cruz Graphite Project, located in Southern Bahia, Brazil is the first of a series of industrial and battery-metals projects that will be put into production. Brazil is the second-largest graphite-producing region in the world with more than 80 years of continuous mining. Santa Cruz has at-surface mineralization in friable materials, and successful, large-scale, pilot-plant testing (>30t) has been completed. The results of the testing show that approximately 65% of Cg concentrate is +80 mesh with good recoveries and 95-99% Cg. With excellent infrastructure and logistics, South Star is carrying its development plan towards Phase 1 production projected in Q4 2022, pending financing. South Star trades on the TSXV under the symbol STS, and on the OTCQB under the symbol STSBF.

South Star is committed to a corporate culture, project execution plan and safe operations that embrace the highest standards of ESG principles based on transparency, stakeholder engagement, ongoing education, and stewardship. To learn more, please visit the Company website at http://www.southstarbatterymetals.com.

This news release has been reviewed and approved by Richard Pearce, P.E., a "Qualified Person" under National Instrument 43-101 and President and CEO of South Star Battery Metals Corp.

On behalf of the Board,

Mr. Richard Pearce
Chief Executive Officer

Twitter: https://twitter.com/southstarbm 
Facebook: https://www.facebook.com/southstarbatterymetals 
LinkedIn: https://www.linkedin.com/company/southstarbatterymetals/ 
YouTube: South Star Battery Metals - YouTube

CAUTIONARY STATEMENT

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

FORWARD-LOOKING INFORMATION

The information contained herein contains "forward-looking statements" within the meaning of applicable securities legislation. Forward-looking statements relate to information that is based on assumptions of management, forecasts of future results, and estimates of amounts not yet determinable. Any statements that express predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance are not statements of historical fact and may be "forward-looking statements".

Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements, including, without limitation: risks related to failure to obtain adequate financing on a timely basis and on acceptable terms; risks related to the outcome of legal proceedings; political and regulatory risks associated with mining and exploration; risks related to the maintenance of stock exchange listings; risks related to environmental regulation and liability; the potential for delays in exploration or development activities or the completion of feasibility studies; the uncertainty of profitability; risks and uncertainties relating to the interpretation of drill results, the geology, grade and continuity of mineral deposits; risks related to the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses; results of prefeasibility and feasibility studies, and the possibility that future exploration, development or mining results will not be consistent with the Company's expectations; risks related to commodity price fluctuations; and other risks and uncertainties related to the Company's prospects, properties and business detailed elsewhere in the Company's disclosure record. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements. Investors are cautioned against attributing undue certainty to forward-looking statements. These forward-looking statements are made as of the date hereof and the Company does not assume any obligation to update or revise them to reflect new events or circumstances. Actual events or results could differ materially from the Company's expectations or projections.

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SOURCE South Star Battery Metals Corp.

FAQ

What is the purpose of the private placement by South Star Battery Metals Corp. (STSBF) on October 15, 2021?

The private placement aims to raise approximately C$1,200,000 for land acquisition, advanced materials sample preparation, and project financing.

How many units will be issued in the private placement by South Star Battery Metals Corp.?

South Star Battery Metals Corp. will issue 10,909,091 units at a price of C$0.11 per unit.

What is the exercise price of the warrants related to the private placement by South Star Battery Metals Corp.?

The exercise price of the warrants is C$0.15 per common share for three years from the date of issue.

What happens if the share price exceeds C$0.50 during the warrant period for South Star Battery Metals Corp.?

If the share price exceeds C$0.50 for ten consecutive trading days, the company may accelerate the expiry of the warrants.