Southstone Announces Proposed Acquisition of Remaining 90% Interest IN Padstone Pte. Ltd

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Southstone Minerals Limited

2751 Graham Street

Victoria, BC, Canada, V8T 3Z1

TSX Venture : SML

www.southstoneminerals.com

SOUTHSTONE ANNOUNCES PROPOSED ACQUISITION OF

REMAINING 90% INTEREST IN PADSTONE PTE. LTD

VICTORIA, BRITISH COLUMBIA — 10 JANUARY 2024 — Southstone Minerals Limited (“Southstone” or the

“Company””) (TSX.V – SML) announces that it entered into a share purchase agreement (the “ Agreement”)

with five arm’s length parties, collectively the “ Sellers”, setting out the terms of an acquisition (the

“Acquisition”) of the remaining 90% interest of the issued and outstanding shares of Padstone Pte. Ltd.

(“Padstone") a private Singaporean company. Southstone is currently a passive shareholder of Padstone,

holding a minority 10% interest.

Padstone, via a wholly owned subsidiary, has applied for two alluvial and kimberlite diamond exploration

permits in the Republic of Guinea , collectively the “Soromaya Project ” or the “ Permits”. The Soromaya

Project is both an alluvial and kimberlite diamond exploration project and covers an area of 198.54 square

kilometers and located northwest of the diamond mining town of Banankoro, approximately 574 k ilometers

east of the capital, Conakry. The Company can provide no assurance as to when, or if, the Permits, will be

granted.

In consideration for the Acquisition, the Sellers will be issued, on a pro-rata basis, an aggregate of 15,500,000

common shares of Southstone (the “ Consideration Shares”), with a deemed value of CAD$0.01, and will be

paid a deferred pro -rata cash payment in the amount of USD$100,000, payable with in 24 months from the

closing date of the Acquisition. Southstone has also agreed to reimburse up to a maximum amount of

USD$100,000 in interest-free Padstone shareholder loans, the proceeds of which were used to fund working

capital and general corporate purposes . Repayment of the loans is due within 18 months from the closing

date of the Acquisition. There is no factual financial information of Padstone to report at this time.

The Agreement with the Sellers w ill be executed on the 10 January 2024 and c losing of the Acquisition is

subject to (i) the two Permits being granted for a period of not less than three years, (ii) a title opinion on the

Soromaya Project and corporate legal opinion for Padstone, and (iii) completion of an independent National

Instrument 43-101 Report (the “Report”) on the Soromaya Project, as well as any other conditions that may

required by the TSX Venture Exchange. Only upon granting of the Permits can the Report be completed and

therefore there are a number of significant milestones required to ultimately close this Acquisition.

The Company has been informed by the Canadian Investment Regulatory Organization (“CIRO”) and the TSV

Venture Exchange that trading of the Company must be halted and will remain halted pending receipt and

review of acceptable documentation regarding the Fundamental Acquisition pursuant to Section 5.6(d) of

Exchange Policy 5.3.

Southstone currently holds a minority 10% interest in Padstone; however, in the event that the Acquisition is

not concluded by 31 March 2024 (the “Long-stop Date”), this 10% interest returns to Padstone’s treasury.

Accordingly, Southstone deems Padstone to be arm’s length on the following basis: (i) no officers or directors

hold office in the other company; (ii) the Company is a passive shareholder and has no control over the

direction or management of Padstone; and (iii) the Company’s minority 10% interest is diminimus, it provides

no voting control over any matter, and is at risk of being returned to Padstone treasury.

The Company also confirms that the non-brokered private placement, as announced on 6 November 2023,

has been extended, which private placement consists of up to 10M units at a price of C$0.05 per unit for gross

proceeds up to C$500,000 (the "Private Placement").

Each unit of the Private Placement shall consist of one common share in the capital of the Company and one-

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half of a share purchase warrant, with each whole warrant entitling the holder to purchase one additional

common share at a price of C$0. 10 per share at any time within two years from the date of issuance. The

warrants shall also be subject to an accelerated exercise clause in the event the Company's share price

exceeds C$0.15 for 10 consecutive trading days.

Proceeds from the Private Placement are anticipated to be used on exploration of the Visirivier and Kabies

Sections of the Oena Mining License which have had little exploration or mining activity to date as well as for

general working capital purposes.

The Company may pay finders fee's in either cash, shares, share purchase warrants or a combination thereof,

as permitted by regulators, on a portion or all the Private Placement. Closing of the Private Placement is

expected to occur on or before 31 March 2024 or closing of the Acquisition. All securities issued under the

Private Placement will be subject to a hold period of four months from the date of issuance.

Upon closing of the Acquisition, the issuance of the Consideration Shares on a pro-rata basis, along with the

Private Placement will not result in any person who was previously not an insider, becoming an insider of

Southstone.

As consideration for introduction and assistance with completing the Acquisition, Southstone has agreed to

issue a finder’s fee of 1,500,000 common shares, with a deemed value of CAD$0.01, to an arm’s length third

party, Mr. Scott Griffin. The issuance of the Consideration Shares and the finders’ fees shares are both subject

to the approval of the TSX Venture Exchange and will be subject to a customary prescribed hold period.

Upon closing of the Acquisition, Southstone intends to appoint a new independent director and a new Chief

Financial Officer, each of whom shall be arm's length to Padstone and its shareholders. No rights have been

granted to Padstone or to its shareholders as it relates to board nominees to the Southstone board of

directors.

ON BEHALF OF THE BOARD OF DIRECTORS OF SOUTHSTONE MINERALS LIMITED

Terry L. Tucker, P.Geo.

Executive Chairman

For additional information, please contact Terry L. Tucker at [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. Capitalized terms used herein that have not been defined have the

same meanings ascribed in the policies of the TSX.V.

Forward-Looking Statement

This news release of Company contains statements that constitute “forward- looking statements.” Such forward- looking statements

involve known and unknown risks, uncertainties and other factors that may cause Southstone’s actual results, performance or

achievements, or developments in the industry to differ materially from the anticipated results, performance or achievements expressed

or implied by such forward-looking statements.