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VANCOUVER, May 26, 2020 /CNW/ - Sun Metals
Corp. (TSX-V: SUNM) (the "Company" or
"Sun Metals") announces the successful closing of its
non-brokered private placement initially announced on May 11, 2020 and upsized on May 13, 2020 due to strong demand (the "Private
Placement").
Pursuant to the Private Placement, the Company issued a
total of 18,750,000 units of the Company (the "Units"), at a
price of $0.08 per Unit, for gross
proceeds of $1,500,000. Each
Unit consists of one common share of the Company (a "Common Share")
and one-half of one Common Share purchase warrant (each whole
warrant, a "Warrant"). Each Warrant entitles the holder to acquire
one Common Share of the Company until May
25, 2021 at a price of $0.12,
and from May 26, 2021 to May 25, 2022 at a price of $0.15. The Company has agreed to pay cash
finder's fees of $79,344 in
connection with the closing of the Private Placement.
Proceeds from the Private Placement will be used primarily to
fund general working capital purposes and exploration at the
Company's Stardust Project. The Common Shares issued pursuant to
the Private Placement, and any Common Shares issuable on exercise
of Warrants are subject to a four month and a day hold period
expiring September 26, 2020, in
accordance with applicable Canadian securities laws.
Certain directors and senior officers, and their associates, of
the Company participated in the Private Placement and acquired an
aggregate of 1,185,000 Common Shares and 592,500 Warrants for
$94,800. The participation of
directors and senior officers constitutes a "related party
transaction" within the meaning of Multilateral Instrument 61-101
("MI 61-101"). The Company has determined that the
transaction is exempt from the formal valuation and minority
shareholder approval requirements under MI 61-101 by virtue of the
exemptions contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101
as neither the fair market value of securities issued to directors
and senior officers nor the consideration paid by directors and
senior officers exceed 25% of the Company's market
capitalization. The Company did not file a material change
report in respect of the Private Placement 21 days in advance of
the closing of the Private Placement because the exact
participation of directors and senior officers had not yet been
confirmed. The shorter period was necessary in order to permit the
Company to close the Private Placement in a timeframe consistent
with usual market practice for transactions of this nature.
Qualified Persons and 43-101 Disclosure
Technical
aspects of this news release have been reviewed, verified and
approved by Ian Neill P.Geo., Vice
President Exploration of Sun Metals, who is a qualified person as
defined by National Instrument 43-101 – Standards of Disclosure for
Minerals Projects.
An updated interactive corporate presentation is available on
Sun Metals' website at
https://www.sunmetals.ca/investors/presentation/.
On Behalf of the Board of Directors of
SUN METALS CORP.
Steve Robertson
Chief Executive Officer
Neither 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.
This news release does not constitute an offer to sell or a
solicitation of an offer to buy nor shall there be any sale of any
of the securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful, including any of the
securities in the United States of
America. The securities have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "1933 Act") or any state securities laws and may not
be offered or sold within the United
States or to, or for account or benefit of, U.S. Persons (as
defined in Regulation S under the 1933 Act) unless registered under
the 1933 Act and applicable state securities laws, or an exemption
from such registration requirements is available.
About Sun Metals
Sun Metals is advancing its 100%
owned flagship, high-grade Stardust Project located in northcentral
British Columbia, Canada. Stardust
is a high-grade polymetallic Carbonate Replacement Deposit with a
rich history. Sun Metals also owns the Lorraine copper-gold project
(joint-ventured with Teck Resources Limited), and the OK
copper-molybdenum project (100%).
The Canyon Creek copper-gold skarn zone at Stardust was the
subject of a 2018, NI 43-101 resource estimate published by the
Company titled "Stardust Project NI 43-101 Technical Report Omineca
Mining Division, British Columbia"
with an effective date of January 8,
2018. In that report, GeoSim Services Inc. provided the
following estimate.
Stardust Project - Canyon Creek zone Mineral Resource
Estimate(3):
Resource
Category
|
Tonnes
|
Copper %
|
Zinc %
|
Gold g/t
|
Silver g/t
|
% Cu Eq
|
Indicated
|
985,000
|
1.34
|
0.62
|
1.59
|
36.8
|
2.92
|
Inferred
|
1,985,000
|
1.24
|
0.14
|
1.72
|
30.5
|
2.65
|
(3)The cut-off grade used in the resource estimate
was 1.5% copper equivalent (Cu Eq). Metal price assumptions for the
Cu Eq calculation were $3.00/lb
Copper, $1.25/lb Zinc, $1,300/oz Gold and $18/oz Silver. Adjustment factors to account for
differences in relative metallurgical recoveries of the
constituents will depend upon completion of definitive
metallurgical testing. The following equation was used to calculate
copper equivalence: Cu Eq = Copper + (Zinc x 0.4167) + (Gold x
0.6319) + (Silver x 0.0087). A cut-off grade of 1.5% Cu Eq
represents an in-situ metal value of approximately $100/tonne which is believed to represent a
reasonable break-even cost for underground mining and processing.
These are not mineral reserves and no work has been completed that
demonstrates economic viability at the Project.
Cautionary Note Regarding Forward-Looking
Statements
All statements in this news release, other
than statements of historical fact, are "forward-looking
information" with respect to Sun Metals within the meaning of
applicable securities laws, including, but not limited to
statements with respect to those that address the Private
Placement, mineralization at the Stardust
project; relative size of mineralization at the 421 zone,
geophysical surveys, use of instrumentation data, and goals and
expectations pertaining to metallurgical results; the 2020 program
and the use of flow-through dollars; the potential quantity and/or
grade of minerals; the growth potential of the Stardust project;
planned mining methods and mineral processing; break-even cost for
the Stardust project; British
Columbia as a reliable jurisdiction for mining; proposed
timing of exploration and development plans; potential conversion
of inferred resources to measured and indicated resources;
potential extension and expansion of mineral resources;
negotiations with the Takla First Nation; the potential impact of
the COVID-19 pandemic; and the focus of the Company in the coming
months. Forward-looking information is often, but not always,
identified by the use of words such as "seeks", "anticipates",
"plans", "continues", "expects", "projects", "predicts",
"potential", "targets", "intends", "believes", "potential",
"budgets", "schedules", "estimates", "forecasts" and similar
expressions (including the negative of such expressions), or
describes a "goal", or variation of such words and phrases or state
that certain actions, events or results "may", "should", "could",
"would", "might" or "will" be taken, occur or be achieved.
Forward-looking information is not a guarantee of future
performance and is based upon a number of estimates and assumptions
of management at the date the statements are made including, among
others, assumptions about future prices of gold and other metal
process; currency exchange rates and interest rates; favourable
operating conditions; political stability; obtaining governmental
approvals and financing on time; obtaining renewals of existing
licences and permits and obtaining required licences and permits;
labour stability; stability in market conditions; availability of
equipment; accuracy of mineral resources; successful resolution of
disputes and anticipated costs and expenditures. Management
believes these estimates and assumptions are reasonable. In
addition, many assumptions are based on factors and events that are
not within the control of Sun Metals and there is no assurance they
will prove to be correct.
Such forward-looking information, involves known and unknown
risks, which may cause the actual results to be materially
different from any future results expressed or implied by such
forward-looking information, including, risks related to the
speculative nature of the Company's business; the Company's
formative stage of development; the Company's financial position;
possible variations in mineralization; conclusions of future
economic evaluations; business integration risks; changes in
project parameters as plans continue to be refined; current
economic conditions; future prices of commodities; fluctuations in
the securities market; fluctuations in currency markets; change in
national and local government, legislation, taxation, controls,
regulation and political or economic development; inability to
obtain adequate insurance to cover risks and hazards; possible
variations in grade or recovery rates; the costs and timing of the
development of new deposits; failure of equipment or processes to
operate as anticipated; the failure of contracted parties to
perform; the timing and success of exploration activities
generally; delays in permitting; possible claims against the
Company; the timing of future economic studies; labour and employee
disputes and other risks of the mining industry; delays in
obtaining governmental approvals, financing or the completion of
exploration; relationships with and claims by local communities and
First Nations; negotiations with the Takla First Nation;
assumptions about the effect of the Covid-19 pandemic; and title to
properties as well as those factors discussed in the Annual
Information Form of the Company dated April
1, 2020 in the section entitled "Risk Factors", under Sun
Metals' SEDAR profile at www.sedar.com.
Although Sun Metals has attempted to identify important
factors that could cause actual actions, events or results to
differ materially from those described in forward-looking
information, there may be other factors that cause actions, events
or results not to be as anticipated, estimated or intended. There
can be no assurance that such information will prove to be accurate
as actual results and future events could differ materially from
those anticipated in such statements. Sun Metals disclaims any
intention or obligation to update or revise any forward-looking
information, whether as a result of new information, future events
or otherwise unless required by law. Accordingly, readers should
not place undue reliance on forward-looking information.
SOURCE Sun Metals