1. Name and Address of Company Heliostar Metals Ltd. (the “ Company ”)
FORM 51-102F3
Material Change Report
1. Name and Address of Company
Heliostar Metals Ltd. (the “ Company ”)
Suite 700, 1090 West Georgia Street
Vancouver, BC V6E 3V7
2. Date of Material Change
October 18, 2021
3. News Release
The news release was disseminated through Newsfile Corp. on October 19, 2021.
4 Summary of Material Change
The Company announced that further to its news releases dated October 4, 2021 and October 6,
2021, it has closed the first tranche of its non-br okered private placement offering (the
“Offering” ) of up to 5,714,285 units (each a “Unit” ) of the Company at a price of $0.70 per Unit
(the “Offering Price” ). In the first tranche, the Company completed the sale of 1,857,465 Units
at the Offering Price for gross proceeds of $1,300,225.50.
5. Full Description of Material Change
5.1 Full Description of Material Change
The Company closed the first tranche of the Offering of up to 5,714,285 Units at a price of $0.70
per Unit (the “Offering Price” ). In the first tranche, the Company completed the sale of
1,857,465 Units at the Offering Price for gross proceeds of $1,300,225.50.
Each Unit consists of one common share in the capital of the Company (each a “Share” ) and one
half of one common share purchase warrant (each who le warrant a “Warrant” ). Each Warrant
is exercisable for one additional Share (a “Warrant Share” ) at an exercise price of $1.20 for a
period of 24 months following the Closing Date.
The Company paid an aggregate amount of $40,675.53 in cash and issued 58,107 broker
warrants ( “Broker Warrants” ) as finders' fees to three qualified finders in co nnection with the
completion of the first tranche of the Offering. E ach Broker Warrant is exercisable into one
Share (each a “Broker Warrant Share” ) at an exercise price of $1.20 for a period of 24 months
following the Closing Date.
The Shares, any Warrant Shares issued upon exercise of any of the Warrants and any Broker
Warrant Shares issued upon exercise of any of the B roker Warrants are subject to a four month
and one-day restricted resale period expiring Febru ary 19, 2022 in accordance with the policies
of the TSX Venture Exchange and securities laws app licable in Canada. The Warrants and the
Broker Warrants are not transferable. In addition to Canadian resale restrictions, any of the
securities sold to investors from other jurisdictio ns may be subject to additional resale
restrictions, including those of the federal laws of the United States of America and any State or
territory thereof.
The Company intends to use the net proceeds from th e Offering to advance its Alaskan and
Mexican projects, focusing primarily on the proposed Cumaro drill program in Q4, 2021, as well
as for working capital and general corporate purposes.
Jacques Vaillancourt, a director, the Executive Cha irman and an ‘insider’ of the Company,
purchased 286,000 Units in the first tranche of the Offering and the Offering is therefore
considered to be a “related party transaction”, as defined under Multilateral Instrument 61-101,
Protection of Minority Security Holders in Special Transactions ( “MI 61-101” ) and Policy 5.9 of
the TSX Venture Exchange, which require that the Co mpany, in the absence of exemptions,
obtain a formal valuation for, and minority shareho lder approval of, the related party
transaction. However, the Offering is exempt: (i) from the formal valuation requirement of MI
61-101 (and Policy 5.9) pursuant to the exemption c ontained in section 5.5(b) of MI 61-101 as
none of the Company’s securities are listed on any of the markets specified in section 5.5(b) of
MI 61-101, and (ii) from the shareholder approval r equirement of MI 61-101 (and Policy 5.9)
pursuant to the exemption contained in section 5.7( 1)(a) of MI 61-101 because the fair market
value of the securities sold to related parties in the Offering did not exceed 25% of the
Company’s market capitalization.
See Item 4 above and the attached news release for a additional details of the material change.
MI 61-101 Requirements
Mount Everest Finance S.A. (“ Mount Everest ”), a company controlled by Jacques Cyril Charles
Vaillancourt, a director and the Executive Chairman of the Company, entered into a subscription
agreement with the Company, whereby Mount Everest acquired 286,000 Units at a price of
$0.70 per Unit for proceeds of $200,200. As such, a portion of the Offering was a “related-party
transaction” as such term is defined in MI 61-101.
MI 61-101 requires that issuers obtain a formal val uation and minority shareholder approval of
related party transactions unless an applicable exe mption is available. The Company has
determined that exemptions from both such requireme nts were available, given that the
aggregate amount of proceeds derived from the insid ers was less than $2,500,000 and the
Company is not listed on a specified market as set out in MI 61-101.
The following table sets out the effect of the Offe ring on the percentage of securities of the
Company beneficially owned or controlled by Mr. Vaillancourt:
Name and
Position
Dollar
Amount
of Units
Purchase
d
Number of
Securities
Purchased
No. of Shares
Held prior to
Closing of the
Offering
Percentage of
Issued and
Outstanding
Shares prior to
Closing of the
Offering
No. of Shares
Held After
Closing of the
Offering
Percentage of
Issued and
Outstanding
Shares After
Closing of the
Offering
Jacques Cyril
Charles
Vaillancourt
Director and
Executive
Chairman
$200,200
286,000
common
shares and
143,000
warrants
Undiluted:
2,816,633 (1)
Diluted:
3,106,633 (2)
Undiluted:
7.55%(3)
Diluted:
8.27%(4)
Undiluted:
3,102,633 (5)
Diluted:
3,535,633 (6)
Undiluted:
7.92%(7)
Diluted:
8.93%(8)
(1) Comprised of 2,816,633 Shares which are held indire ctly in the name of Mount Everest Finance S.A. (“ Mount
Everest ”), a company wholly owned and controlled by Mr. Vaillancourt.
(2) Comprised of: (i) 2,816,633 Shares held indirectly in the name of Mount Everest, (ii) 50,000 stock opti ons held
directly, exercisable at $2.10 per Share until April 11, 2022, (iii) 106,667 stock options held directly, exercisable at
$0.75 per Share until October 29, 2024, and (iv) 13 3,333 stock options held directly, exercisable at $ 1.725 per
Share until September 4, 2025.
(3) Based on 37,292,268 Shares outstanding prior to the completion of the private placement of Units on Oc tober
18, 2021.
(4) Based on 37,582,268 Shares outstanding on a partial ly-diluted basis prior to the completion of the Off ering,
comprised of: (i) 37,292,268 Shares outstanding pri or to the completion of the private placement of Un its on
October 18, 2021; and (ii) 290,000 Shares that may be issuable on exercise of stock options of the Com pany held
by Mr. Vaillancourt.
(5) Comprised of: (i) 3,102,633 Shares which are held indirectly in the name of Mount Everest;
(6) Comprised of: (i) 3,102,633 Shares which are held i ndirectly in the name of Mount Everest, (ii) 143,000 Share
purchase warrants held indirectly in the name of Mou nt Everest, exercisable at $1.20 per Share until Oc tober 18,
2023, (ii) 50,000 stock options held directly, exercisable at $2.10 per Share until April 11, 2022, (i ii) 106,667 stock
options held directly, exercisable at $0.75 per Sha re until October 29, 2024, and (iv) 133,333 stock o ptions held
directly, exercisable at $1.725 per Share until September 4, 2025.
(7) Based on 39,149,733 Shares outstanding following th e completion of the private placement of Units on O ctober
18, 2021.
(8) Based on 39,582,733 Shares outstanding on a partial ly diluted-basis following completion of the Offeri ng,
comprised of: (i) 39,149,733 Shares outstanding aft er the completion of the private placement of Units on
October 18, 2021; (ii) 143,000 Shares that may be i ssuable on exercise of Warrants of the Company held by
Mount Everest, all exercisable within 60 days, and ( iii) 290,000 Shares that may be issuable on exercis e of stock
options of the Company held by Mr. Vaillancourt.
The Company did not file a material change report 21 days prior to closing of the Offering as the
Company was not aware of all details of the insider participation in the Offering until just before
closing.
5.2 Disclosure for Restructuring Transactions
Not applicable.
6. Reliance on subsection 7.1(2) of National Instru ment 51-102
Not applicable.
7. Omitted Information
None.
8. Executive Officer
Charles Funk, CEO of the Board, 604-347-9772
9. Date of Report
October 20, 2021
1090 West Georgia Street, Suite 700, Vancouver BC, V6E 3V7, Canada -- Tel +1 236 429 9306
TSX.V: HSTR, OTCQX: HSTXF, FRA: RGG1
Not for Dissemination in the United States or to U.S. Newswire Services
Heliostar Announces Closing of First Tranche of
$4 Million Non-Brokered Private Placement
Vancouver, Canada, October 19, 2021 – Heliostar Metals Limited (TSX.V: HSTR, OTCQX: HSTXF, FRA: RGG1)
("Heliostar" or the "Company") is pleased to announce that, further to its news releases dated October 4, 2021
and October 6, 2021, it has closed the first tranche of its non -brokered private placement offering (the
“Offering”) of up to 5,714,285 units (each a “Unit”) of the Company at a price of $0.70 per Unit (the “Offering
Price”). In the first tranche, the Company completed the sale of 1,857,465 Units at the Offering Price for gross
proceeds of $1,300,225.50.
Heliostar CEO, Charles Funk, commented: “This $4 million Offering has received strong support; it is already over-
subscribed and we intend to close on the balance over the next two weeks. The next step for Heliostar is to
commence a 2,500 to 3,000 metre drilling on the recent Verde discovery at Cumaro, in Mexico, in November. The
potential of the project based on the recently received assay results has caused us to prioritize this drill program
for Q4, 2021. Heliostar has one of the most exciting portfolios of high-grade gold and silver projects in the industry
and we expect that this financing will set the stage for news flow over the coming months.”
About the Private Placement
Each Unit consists of one common share in the capital of the Company (each a “Share”) and one half of one
common share purchase warrant (each whole warrant a “Warrant”). Each Warrant is exercisable for one
additional Share (a “Warrant Share”) at an exercise price of $1.20 for a period of 24 months following the Closing
Date.
An aggregate amount of $ 40,675.53 in cash and 58,107 broker warrants (“Broker Warrants” ) were paid as
finders' fees to three qualified finders in connection with the completion of the first tranche of the Offering. Each
Broker Warrant is exercisable into one Share (each a “Broker Warrant Share”) at an exercise price of $1.20 for a
period of 24 months following the Closing Date.
The Shares, any Warrant Shares issued upon exercise of any of the Warrants and any Broker Warrant Share s
issued upon exercise of any of the Broker Warrants are subject to a four month and one -day restricted resale
period expiring February 19, 2022 in accordance with the policies of the TSX Venture Exchange and securities
laws applicable in Canada. The Warrants and the Broker Warrants are not transferable. In addition to Canadian
resale restrictions, any of the securities sold to investors from ot her jurisdictions may be subject to additional
resale restrictions, including those of the federal laws of the United States of American and any State or territory
thereof.
The Company intends to use the net proceeds from the Offering to advance its Alaskan and Mexican projects,
focusing primarily on the proposed Cumaro drill program in Q4, 2021, as well as for working capital and general
corporate purposes.
Jacques Vaillancourt, a director and an ‘insider’ of the Company, purchased 286,000 Units in the first tranche of
the Offering and t he Offering is therefore considered to be a “related party transaction”, as defined under
TSX.V: HSTR
OTCQX: HSTXF
1090 West Georgia Street, Suite 700, Vancouver BC, V6E 3V7, Canada -- Tel +1 236 429 9306
TSX.V: HSTR, OTCQX: HSTXF, FRA: RGG1
Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions (“MI 61-101”) and
Policy 5.9 of the TSX Venture Exchange, which require that the Company, in the absence of exemptions, obtain
a formal valuation for, and minority shareholder approval of, the related party transaction . However, the
Offering is exempt: (i) from the formal valuation requirement of MI 61 -101 (and Policy 5.9) pursuant to the
exemption contained in section 5.5(b) of MI 61-101 as none of the Company’s securities are listed on any of the
markets specified in section 5.5(b) of MI 61 -101, and (ii) from the shareholder approval requirement of MI 61 -
101 (and Policy 5.9) pursuant to the exemption contained in section 5.7(1)(a) of MI 61 -101 because the fair
market value of the securities sold to related parties in the Offering did not exceed 25% of the Company’s market
capitalization.
None of the securities to be issued in the Offering have been or will be registered under the United States
Securities Act of 1933, as amended (the “1933 Act”), and none may be offered or sold in the United States absent
registration or an applicable exemption from the registration requirements of the 1933 Act. This press release
shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities
offered in the Offering in any state where such offer, solicitation or sale would be unlawful.
About Heliostar Metals Ltd.
Heliostar is a junior exploration and development company with a portfolio of high-grade gold projects in Alaska
and Mexico. The company’s flagship asset is the 100% controlled Unga Gold Project on Unga and Popof Islands
in Alaska. The project hosts an intermediate sulfidation epithermal gold deposit, located within the district-scale
property that encompasses 240km2 across the two islands. Additional targets on the property include porphyry,
high sulphidation and intermediate sulphidation epithermal vein s. On Unga Island, priority targets include: the
SH-1 and Aquila, both on the Shumagin Trend, the former Apollo -Sitka mine, which was Alaska’s first
underground gold mine and the Zachary Bay porphyry gold -copper prospect. Gold mineralization at the
Centennial Zone is located on neighbouring Popof Island within four kilometres of infrastructure and services at
Sand Point.
In Mexico, the company owns 100% of three early stage epithermal projects in Sonora that are highly prospective
for gold and silver. Cum aro forms part of the El Picacho district, while the Oso Negro and La Lola projects are
also prospective for epithermal gold-silver mineralization.
For additional information please contact:
Charles Funk
Chief Executive Officer
Heliostar Metals Limited
Email: [email protected]
Rob Grey
Investor Relations Manager
Heliostar Metals Limited
Email: [email protected]
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.
Forward-Looking Information. This release includes certain statements that may be deemed "forward -looking
statements". Forward-looking statements are statements that are not historical facts and are generally, but not
1090 West Georgia Street, Suite 700, Vancouver BC, V6E 3V7, Canada -- Tel +1 236 429 9306
TSX.V: HSTR, OTCQX: HSTXF, FRA: RGG1
always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects",
"potential" and similar expressions, or that events or conditions "would", "ma y", "could" or "should" occur.
Forward-looking statements in this press release include Heliostar’s intent to close the balance of the Offering
over the next few weeks, its planned use of proceeds , including the plan to prioritize and commence a drill
program at Cumaro during Q4, 2021; it expectation that this financing will set the stage for news flow over the
coming months. Although Heliostar believes that the expectations expressed in such forward-looking statements
are based on reasonable assumptions, such statements are not a guarantee of future performance and actual
results may differ materially from those in the forward -looking statements. Factors that could cause the actual
results to diff er materially from those in forward -looking statements include market prices, exploitation and
exploration successes, weather, continued availability of capital and financing, and general economic, market or
business conditions. Investors are cautioned that any such statements are not guarantees of future performance
and actual results or developments may differ materially from those projected in the forward-looking statements.
Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on
the date the statements are made. Except as required by applicable securities laws, the Company undertakes no
obligation to update these forward -looking statements in the event that management's beliefs, estimates or
opinions, or other factors, should change.