CALGARY, June 04, 2018 (GLOBE NEWSWIRE) — Groundstar Resources Limited (TSXV:GSA) (the “Company”) is pleased to announce that it has closed on the first tranche of its previously announced non-brokered private placement of a maximum of up to 20 million units in the capital of the Company (the “Common Units”) at a price of $0.01 per unit, each unit consisting of a common share in the capital of the Company (“Common Share”) and a common share purchase warrant (a “Warrant”) for gross proceeds of up to CAD$200,000 (the “Common Offering”). Each Warrant will permit the holder to acquire one additional Common Share at a price of $0.05 in the first year from closing and at $0.075 in the second year from closing. The Company issued a total of 16,650,000 Common Units for gross proceeds of $166,500 pursuant to the closing of the first tranche of the Common Offering. The Common Shares and Warrants are subject to a four month hold from the date of the closing, such hold period expiring on October 2, 2018. Commissions of $1,400 were paid in connection with the closing of the Common Offering. Closing of the Financings and the applicable pricing thereof are subject to approval of the TSXV.
The Company will utilize the net proceeds from the Common Offering for general corporate purposes and to seek different corporate opportunities, which may involve drilling new wells, seeking a farm-in opportunity or acquiring producing assets.