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Canada Strategic Metals Arranges Non-Brokered Private Placement
Vancouver, British Columbia - October 9th, 2012 - Today, Canada Strategic Metals Inc. ("Canada Strategic Metals" or the "Company") (TSX.V: CJC; FSE: YXEN; OTC-BB: CJCFF) announces that it has arranged a non-brokered private placement offering of up 2,000,000 units at a price of $0.055 per unit, with each unit consisting of one common share and one non-transferrable common share purchase warrant exercisable for two years at a price of $0.10 per share.
The Company intends to use the proceeds from the private placement to advance the Company's graphite projects and for general working capital.
Certain insiders of the Company may acquire securities under the private placement. Any such participation would be considered to be a "related party transaction" as defined under Multilateral Instrument 61-101. The transaction will be exempt from the formal valuation and minority shareholder approval requirements of Multilateral Instrument 61-101 as neither the fair market value of any shares issued to or the consideration paid by such persons will exceed 25% of the Company's market capitalization.
The private placement is subject to the approval of the TSX Venture Exchange (the "Exchange"). Any securities issued pursuant to the private placement will be subject to a hold period of four months from the closing date of the private placement in accordance with applicable Canadian securities laws.
The Company also announces that it has filed on SEDAR and mailed to shareholders the information circular and related meeting materials for the Company's Annual General Meeting to be held on Monday, November 5, 2012 at 11:00 a.m. (Pacific Time). One of the resolutions shareholders will be asked to approve at the meeting is an ordinary resolution authorizing the issuance of up to 2,000,000 common shares of the Company under a Compensation Share Program to a company owned by two of the directors of the Company, Ron MacDonald and Mark Baggio. Shares will be issuable under the program only upon the Company achieving the following key business milestones: (1) a strategic financing of at least $5 million; (2) a significant off-take agreement or joint venture agreement; and (3) a board-approved acquisition of the Company. The milestones and the other terms and conditions of the program are described in greater detail in the information circular. Mr. Baggio and Mr. MacDonald propose to utilize their extensive involvement and knowledge of Asia's rapid adoption of green energy targets for both vehicles and electric storage to globally promote the Company's new graphite assets, and this program is intended to reward and incentivize these efforts. The Compensation Share Program has been approved by the board of directors of the Company (other than Messrs. Baggio and Mr. MacDonald) and conditionally accepted by the Exchange. The issuance of shares under the program is subject to disinterested shareholder approval and final Exchange approval.
About Canada Strategic Metals
Canada Strategic Metals is an emerging growth company focused on the exploration and development of its large portfolio of graphite projects located throughout Quebec. With management experience in green technology, Quebec exploration and development, and the junior resource sector, Canada Strategic Metals is well positioned to aggressively advance this promising portfolio for our shareholders.
Neither the 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.
Jean-Sebastien Lavallee, P. Geo
President & Chief Executive Officer
819.354.5146
Paradox Public Relations
514.341.0408
On behalf of the Board,
"Jean-Sebastien Lavallee"
President & CEO
Cautionary Note Regarding Forward-Looking Statements: Certain disclosure in this release, including statements regarding the possible completion of a private placement and the intended use of proceeds and a compensation share program may constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities legislation. In making the forward-looking statements in this release, the Company has applied certain factors and assumptions that the Company believes are reasonable, including that the Company is able to obtain required Exchange approvals to complete the Company's planned private placement and Exchange and shareholder approvals required for the compensation share program. However, the forward-looking statements in this release are subject to numerous risks, uncertainties and other factors that may cause future results to differ materially from those expressed or implied in such forward-looking statements. Such uncertainties and risks may include, among others, delays in obtaining or failure to obtain required approvals. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Readers are cautioned not to place undue reliance on forward-looking statements. The Company does not intend, and expressly disclaims any intention or obligation to, update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law. |