Arctic Star Exploration Corp. — Regulatory Filings 2022

Jul 13, 2022

FORM 51-102F3

MATERIAL CHANGE REPORT

Item 1

Name and Address of Company

Arctic Star Exploration Corp. (the “Company”)
1111 Melville Street, 11th Floor
Vancouver, British Columbia V6E 3V6

Item 2

Date of Material Change

July 8, 2022

Item 3

News Release

News release dated July 12, 2022 was disseminated and subsequently filed on SEDAR.

Item 4

Summary of Material Change

The Company completed its previously announced non-brokered private placement of units of the Company (the “Units”) and raised approximate gross proceeds of $1,000,000 (the “Private Placement”).

Item 5

Full Description of Material Change

The Company completed the Private Placement pursuant to which the Company sold and issued 14,285,714 Units, at $0.07 per Unit, for approximate gross proceeds of $1,000,000.

The Warrants issued under the Private Placement are exercisable to purchase 14,285,714 common shares of the Company (the “Shares”), at $0.10 per Share, until July 8, 2024 or earlier subject to an accelerated option clause (the “Acceleration Clause”). Pursuant to the Acceleration Clause, if the common shares of the Company close at or above $0.30 for five consecutive trading days on the TSX Venture Exchange (the “TSXV”), then the Warrants must be exercised within a 60-day period by the warrant holders, or failing which, the Warrants shall expire as null and void.

An aggregate 228,571 Units were sold and issued to a director of the Company.

All securities issued in connection with the Private Placement are subject to a statutory hold period expiring on November 9, 2022 in accordance with applicable securities legislation.

The Company intends to use the net proceeds from the Private Placement to carry out exploration on its Diagras Joint Venture (81.5% Arctic Star) and for general and corporate purposes.

The securities offered and sold under the Private Placement have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from the registration requirements. This report will not constitute an offer to sell or the solicitation of an offer to buy nor will there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

All references to currency in this report are to Canadian currency.

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Item 5.2 Disclosure for Restructuring Transactions
Not applicable.

Item 6 Reliance on subsection 7.1(2) of National Instrument 51-102
Not applicable.

Item 7 Omitted Information
Not applicable.

Item 8 Executive Officer
Patrick Power, President & CEO
Tel: 604-689-1799

Item 9 Date of Report
July 13, 2022

This report contains "forward-looking statements" including but not limited to statements with respect to Arctic Star's plans, the Private Placement and the use of proceeds. Forward-looking statements, while based on management's best estimates and assumptions, are subject to risks and uncertainties that may cause actual results to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the completion of the Private Placement and our plan to use all or some portion of the proceeds for exploration on the Diagras Diamond Project. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Factors that could affect our plans include the possibility that we do not receive final TSXV approval for the Private Placement or we are unable to raise all of the funds we are seeking to raise, in which event we may require all funds raised, if any, to be used for working capital rather than for exploration on the Diagras Diamond Project; and our proposed use of proceeds is subject to receipt of TSXV approval. Accordingly, readers should not place undue reliance on forward-looking statements. Arctic Star undertakes no obligation or responsibility to update forward-looking statements, except as required by law.

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