South Star Announces Closing of First Tranche of Non-Brokered Private Placement of Units

Core Viewpoint - South Star Battery Metals Corp. has successfully closed the first tranche of its non-brokered private placement, raising gross proceeds of C$828,227 (approximately US$595,847) by issuing 5,521,512 units at a price of C$0.15 per unit [1][3]. Group 1: Unit Offering Details - Each unit consists of one common share and one common share purchase warrant, with the warrant allowing the purchase of an additional share at C$0.20 for five years, subject to acceleration conditions [2]. - The securities from the first tranche are subject to a statutory hold period of four months and one day, and the net proceeds will be allocated for exploration, development, and working capital [3]. - The company plans to close additional tranches of the Unit Offering, pending necessary approvals [4]. Group 2: Changes in Financing Strategy - The company has decided to cancel a previously announced Note Offering of convertible notes for gross proceeds of up to C$2.085 million, redirecting those funds to purchase units in the Unit Offering instead [5]. - This change has increased the total size of the Unit Offering to up to C$6,255,000 (US$4.5 million) [5]. Group 3: Insider Participation - Funds controlled by Mr. Tiago Cunha purchased 1,557,912 units in the first tranche, giving him control of 19.9% of the company's shares [6]. - The company intends to hold a shareholder meeting to seek approval for Mr. Cunha to become a control person, which would allow for the purchase of an additional 12,342,088 units [6]. - Insiders collectively purchased 2,007,912 units in the first tranche, qualifying as a related party transaction under MI 61-101, with the company relying on exemptions from formal valuation and minority shareholder approval [7]. Group 4: Company Overview - South Star Battery Metals Corp. is focused on developing battery metals projects in the Americas, with its Santa Cruz Graphite Project in Brazil being the first to enter production [11]. - The Santa Cruz project has shown promising results, with successful pilot-plant testing indicating high-quality graphite concentrate [11]. - The BamaStar Project in Alabama is also in development, with strong economic assessments indicating a pre-tax NPV of US$2.4 billion and an IRR of 35% [12].