BRIGHTSTAR RESOURCES LIMITED — Capital/Financing Update 2020

Aug 11, 2020

==> picture [463 x 84] intentionally omitted <==

12
August
2020

Stone
Resources
Australia
recapitalisation
major
step
closer
with
$10m
agreement
to
sell
Ben
Hur to
Regis
Resources

• SRAL
  strikes
  deal
  to
  sell
  Ben
  Hur
  project
  to
  Regis
  for
  $10
  million
  in
  Regis
  shares
  and
  royalty

• Deal
  will
  enable
  SRAL
  to
  pay
  major
  shareholder
  Stone
  HK
  $6
  million
  pursuant
  to
  the proposed
  share
  buyback
  and
  debt
  cancellation

• SRAL
  to
  retain
  $4
  million
  cash
  or
  shares
  in
  Regis

• Subject
  to
  SRAL
  shareholder
  approval,
  the
  share
  buyback
  and
  debt
  cancellation
  will
  leave SRAL
  well
  positioned
  to
  advance
  Brightstar
  Gold
  Project
  at
  a
  time
  of
  record
  high
  gold
  prices

• PCF
  Capital
  Group
  retained
  by
  SRAL
  as
  strategic
  and
  financial
  adviser

West
Australian
gold
development
company
Stone
Resources
Australia
Limited
( ASX:
SHK )
( SRAL or the Company )
is
pleased
to
announce
that
it
has
today
executed
a
sale
purchase
agreement
( SPA ) with
Regis
Resources
Ltd
( ASX:
RRL )
( Regis )
for
the
sale
by
SRAL
of
its
Ben
Hur
project
on
which
is made
up
of
two
Exploration
Licences,
three
Prospecting
Licences,
one
Miscellaneous
Licence
and with
three
mining
Leases,
as
set
out
in
the
Tenement
Table
below
at
Table
2
( Ben
Hur ).
Under
the SPA
and
associated
agreements,
SRAL
will
receive:

• (a) $10
  million
  in
  Regis
  shares
  as
  the
  purchase
  price
  calculated
  on
  a
  5
  day
  VWAP
  at
  the
  date
  of completion;
  and

• (b) a
  1%
  NSR
  on
  Mining
  Lease
  38/339
  ( Ben
  Hur
  Royalty )
  commencing
  after
  the
  first
  100koz
  have been
  produced
  at
  Ben
  Hur.
  The
  royalty
  is
  capped
  at
  $5
  million,
  after
  which
  it
  will
  revert
  to
  a 0.0025%
  NSR
  for
  four
  years.

The
SPA
is
an
excellent
outcome
for
SRAL
and
an
important
step
in
the
Company’s
recapitalisation process
as
set
out
in
the
Debt
Equity
Compromise
Agreement
( DECA )
announced
to
the
ASX
on
25 March
2020.
If
SRAL
sells
the
Regis
shares
into
the
market
the
Company’s
cash
resources
will
stand at
approximately
$4
million
once
a
$6
million
payment
is
made
under
the
DECA
as
detailed
below.

The
SPA
is
subject
to
usual
conditions
precedent
and
completion
under
the
SPA
is
anticipated
to
take place
in
approximately
three
to
four
weeks.
The
interaction
of
the
SPA
with
the
DECA,
including
the proposed
assignment
of
the
Ben
Hur
Royalty
to
Stone
(HK),
is
set
out
further
below.

The
recapitalisation
process
presents
an
exciting
opportunity
for
SRAL
to
advance
development
of
its Brightstar
Gold
Project
south-­‐east
of
Laverton
in
WA’s
Goldfields,
a
Tier
1
gold
province,
at
a
time when
gold
prices
are
at
record
highs.
Particularly,
SRAL
intends
to
step
up
exploration
across
its Alpha,
Beta
and
Cork
Tree
Well
(Delta)
deposits
(details
in
Table
1
below)
to
add
to
existing
mineral resources
of
450koz
around
its
300ktpa
Brightstar
processing
plant
(on
care
and
maintenance).

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**Table

1**

33 25 58 48 125 202 87 57 133 104

Brightstar
Project
-­‐-­‐-­‐
Mineral
Resource
Estimate
Results
for
Alpha,
Ben
Hur
and
Delta
Deposits (as announced
to
the
ASX
by
SRAL
on
5
June
2014)

SRAL
will
continue
to
work
with
leading
mining
sector
advisory
firm
PCF
Capital
Group
on
strategic and
financial
initiatives
to
deliver
value
for
all
shareholders.

**Table

2
Tenement
Table**

Tenement number E38/3199 E38/3234 M38/1241 M38/160 M38/339 P38/4114 P38/4115 P38/4364 L38/206

**Recapitalisation

on
track**

As
previously
announced
to
the
ASX
on
25
March
2020
and
29
June
2020,
SRAL
has
entered
into
a Debt
and
Equity
Compromise
agreement
with
major
shareholders
Stone
Resources
(HK)
Ltd
( Stone

錯誤! 無法識別文件摘要資訊名稱。

3/25 Belgravia Street Belmont WA 6104 Telephone: (618) 9277 6008 Facsimile: (618) 9277 6002 Email: info@stoneral.com.au Website: www. stoneral.com.au ABN 44 100 727 491 ASX Code: SHK Member of AMEC

HK )
and
Stone
Resources
Ltd
(a
Bermudan
entity)
( Stone
Bermuda ).

In
parallel
to
the
SPA,
SRAL
has today
also
executed
a
deed
amending
the
DECA
( Amendment
Deed )
with
major
shareholders
Stone HK
and
Stone
Bermuda
to
address
the
terms
of
the
SPA.
The
material
amendments
to
the
DECA through
the
Amendment
Deed
provide
that
SRAL
will:

• (a) transfer
  the
  Ben
  Hur
  Royalty
  to
  Stone
  HK
  within
  20
  months
  from
  11
  August
  2020;

• (b) grant
  a
  3%
  NSR
  on
  SRAL’s
  retained
  tenements
  to
  Stone
  HK
  within
  20
  months
  from
  11
  August 2020;

• (c) pay
  $6
  million
  cash
  to
  Stone
  HK
  from
  the
  proceeds
  of
  the
  Ben
  Hur
  sale
  under
  the
  SPA;
  and

• (d) pay
  $5.4
  million
  in
  SRAL
  shares
  or
  cash,
  at
  SRAL’s
  election,
  to
  Stone
  HK
  within
  36
  months from
  11
  August

The
following
terms
of
the
DECA
remain
unchanged
and,
subject
to
SRAL
shareholder
approval,
will include:

• (a) the
  cancellation
  by
  Stone
  HK
  of
  approximately
  $53
  million
  in
  debt
  owed
  by
  SRAL
  to
  Stone
  HK ( Debt
  Cancellation );
  and

• (b) the
  buyback
  by
  SRAL
  of
  approximately
  433
  million
  shares
  held
  by
  Stone
  Bermuda
  and
  Stone HK,
  reducing
  SRAL’s
  issued
  capital
  by
  about
  58%
  ( Share
  Cancellation ).
  Stone
  Bermuda
  and Stone
  HK
  will
  no
  longer
  be
  shareholders
  in
  SRAL.

The
DECA
and
Amendment
Deed,
once
implemented,
will
result
in
SRAL’s
total
issued
capital
base being
reduced
from
836
million
to
403
million
shares,
resulting
in
a
tighter
capital
structure
and
a strong
balance
sheet.
This
will
enable
SRAL
to
refocus
its
efforts
on
expanding
the
combined ~450koz
gold
resources
across
Alpha,
Beta
and
Cork
Tree
Well
(Delta)
(refer
Table
1
above)
and delivering
value
for
all
shareholders
from
its
300ktpa
Brightstar
processing
plant.

The
Debt
Cancellation
and
Share
Cancellation
both
require
the
approval
of
SRAL’s
shareholders
at
a yet-­‐to-­‐be
called
General
Meeting.
SRAL
has
commissioned
BDO
to
prepare
an
Independent
Expert’s Report
( IER )
in
respect
of
the
Debt
Cancellation
and
Share
Cancellation.
In
the
event
that
these
or any
other
required
approvals
are
not
able
to
be
obtained
then
the
DECA
will
not
be
able
to
be completed
however
the
SPA
and
the
sale
of
Ben
Hur
will
be
unaffected.

SRAL
anticipates
the
dispatch
of
the
Notice
of
Meeting
and
the
IER
before
the
end
of
this
month, ahead
of
the
General
Meeting
which
is
likely
to
be
held
in
late
September.

The
information
in
this
report
that
references
previously
reported
exploration
results
and
Mineral Resources
have
been
extracted
from
SRAL’s
ASX
market
announcements.
These
previous
market announcements
are
available
to
view
on
SRAL's
website
or
on
the
ASX
website
(www.asx.com.au). SRAL
confirms
that
it
is
not
aware
of
any
new
information
or
data
that
materially
affects
the information
included
in
the
original
market
announcements
but
has
not
independently
validated
the former
owner’s
estimates
or
exploration
results
and
therefore
is
not
to
be
regarded
as
reporting, adopting
or
endorsing
those
estimates
or
results.

Report
Name:
Mineral
Resource
Review
of
Brightstar
Project,
Western
Australia

Date:
5
June
2014

Site:
https://www.asx.com.au/asxpdf/20140605/pdf/42q1s33lrh39wy.pdf

錯誤! 無法識別文件摘要資訊名稱。 3/25 Belgravia Street Belmont WA 6104 Telephone: (618) 9277 6008 Facsimile: (618) 9277 6002 Email: info@stoneral.com.au Website: www. stoneral.com.au ABN 44 100 727 491 ASX Code: SHK Member of AMEC

This
announcement
is
authorised
by
Non-­‐executive
Director
William
Hobba
on
behalf
of
the
Board
of the
Company.

**For

further
information,
please
contact:**

William
Hobba Liam
Twigger Non-­‐executive
Director PCF
Capital
Group Phone:
+61
8
9277
6008 Phone:
+61
(0)412
796
632 Email:
miningservicesA1@bigpond.com Email:
liam@pcfcapital.com.au

**CAUTIONARY

NOTE
REGARDING
FORWARD-­‐LOOKING
INFORMATION**

This
Announcement
contains
forward-­‐looking
statements
and
forward-­‐looking
information
within the
meaning
of
applicable
Australian
securities
laws,
which
are
based
on
expectations,
estimates
and projections
as
of
the
date
of
this
Announcement.

This
forward-­‐looking
information
includes,
or
may
be
based
upon,
without
limitation,
estimates, forecasts
and
statements
as
to
management’s
expectations
with
respect
to,
among
other
things,
the timing
and
amount
of
funding
required
to
execute
the
Company’s
exploration,
development
and business
plans,
capital
and
exploration
expenditures,
the
effect
on
the
Company
of
any
changes
to existing
legislation
or
policy,
government
regulation
of
mining
operations,
the
length
of
time required
to
obtain
permits,
certifications
and
approvals,
the
success
of
exploration,
development and
mining
activities,
the
geology
of
the
Company’s
properties,
environmental
risks,
the
availability of
labour,
the
focus
of
the
Company
in
the
future,
demand
and
market
outlook
for
precious
metals and
the
prices
thereof,
progress
in
development
of
mineral
properties,
the
Company’s
ability
to
raise funding
privately
or
on
a
public
market
in
the
future,
the
Company’s
future
growth,
results
of operations,
performance,
and
business
prospects
and
opportunities.
Wherever
possible,
words
such as
“anticipate”,
“believe”,
“expect”,
“intend”,
“may”
and
similar
expressions
have
been
used
to identify
such
forward-­‐looking
information.

Forward-­‐looking
information
is
based
on
the
opinions
and
estimates
of
management
at
the
date
the information
is
given,
and
on
information
available
to
management
at
such
time.
Forward
looking information
involves
significant
risks,
uncertainties,
assumptions
and
other
factors
that
could
cause actual
results,
performance
or
achievements
to
differ
materially
from
the
results
discussed
or implied
in
the
forward-­‐looking
information.
These
factors,
including,
but
not
limited
to,
fluctuations in
currency
markets,
fluctuations
in
commodity
prices,
the
ability
of
the
Company
to
access
sufficient capital
on
favourable
terms
or
at
all,
changes
in
national
and
local
government
legislation,
taxation, controls,
regulations,
political
or
economic
developments
in
Indonesia
and
Australia
or
other countries
in
which
the
Company
does
business
or
may
carry
on
business
in
the
future,
operational
or technical
difficulties
in
connection
with
exploration
or
development
activities,
employee
relations, the
speculative
nature
of
mineral
exploration
and
development,
obtaining
necessary
licenses
and permits,
diminishing
quantities
and
grades
of
mineral
reserves,
contests
over
title
to
properties, especially
title
to
undeveloped
properties,
the
inherent
risks
involved
in
the
exploration
and development
of
mineral
properties,
the
uncertainties
involved
in
interpreting
drill
results
and
other geological
data,
environmental
hazards,
industrial
accidents,
unusual
or
unexpected
formations, pressures,
cave-­‐ins
and
flooding,
limitations
of
insurance
coverage
and
the
possibility
of
project
cost overruns
or
unanticipated
costs
and
expenses,
and
should
be
considered
carefully.
Many
of
these uncertainties
and
contingencies
can
affect
the
Company’s
actual
results
and
could
cause
actual

錯誤! 無法識別文件摘要資訊名稱。 3/25 Belgravia Street Belmont WA 6104 Telephone: (618) 9277 6008 Facsimile: (618) 9277 6002 Email: info@stoneral.com.au Website: www. stoneral.com.au ABN 44 100 727 491 ASX Code: SHK Member of AMEC

results
to
differ
materially
from
those
expressed
or
implied
in
any
forward-­‐looking
statements
made by,
or
on
behalf
of,
the
Company.
Prospective
investors
should
not
place
undue
reliance
on
any forward-­‐looking
information.

Although
the
forward-­‐looking
information
contained
in
this
Announcement
is
based
upon
what management
believes,
or
believed
at
the
time,
to
be
reasonable
assumptions,
the
Company
cannot assure
prospective
purchasers
that
actual
results
will
be
consistent
with
such
forward-­‐looking information,
as
there
may
be
other
factors
that
cause
results
not
to
be
as
anticipated,
estimated
or intended,
and
neither
the
Company
nor
any
other
person
assumes
responsibility
for
the
accuracy and
completeness
of
any
such
forward-­‐looking
information.
The
Company
does
not
undertake,
and assumes
no
obligation,
to
update
or
revise
any
such
forward-­‐looking
statements
or
forward-­‐looking information
contained
herein
to
reflect
new
events
or
circumstances,
except
as
may
be
required
by law.

No
stock
exchange,
regulation
services
provider,
securities
commission
or
other
regulatory
authority has
approved
or
disapproved
the
information
contained
in
this
Announcement

錯誤! 無法識別文件摘要資訊名稱。 3/25 Belgravia Street Belmont WA 6104 Telephone: (618) 9277 6008 Facsimile: (618) 9277 6002 Email: info@stoneral.com.au Website: www. stoneral.com.au ABN 44 100 727 491 ASX Code: SHK Member of AMEC