Stearman Resources Announces Extension of Warrant Expiry Date

Author: Thomas Cooper Updated: 09-10-2024 04:30 PM

Stearman Resources Provides Update on Warrant Amendments

Stearman Resources Inc. (“Stearman” or the “Company”) has announced an important update regarding its outstanding warrants. The Company intends to take action effective September 30 to extend the expiry date of a total of 6,000,000 common share purchase warrants. This extension will push the expiry date to September 30 of the following year, subject to specific acceleration provisions outlined below.

Details of Warrant Amendments

The exercise price of these warrants will be adjusted to $0.06 under what are being termed the “Warrant Amendments.” According to Canadian Securities Exchange (“CSE”) policy, there are regulations that allow for a maximum of 10% of total warrants held by insiders to be repriced. In this case, two directors and officers of the Company hold a combined total of 1,200,000 of these warrants, leading to a decision to reprice half of the warrants held by each, while the other half will maintain the original exercise price of $0.10.

Understanding Acceleration Provisions

These amendments come with a built-in mechanism known as the “Acceleration Provision.” Under this provision, if the closing price of the Company’s shares exceeds $0.075 for any consecutive ten trading days, then the affected warrants will be set to expire at a specific time. This means that the warrants will automatically expire 37 days after this threshold is met if not exercised prior to that time. The strategy behind this provision is intended to provide a timely incentive for warrant holders and offer a degree of protection to both the Company and its shareholders.

Related Party Transaction Considerations

Since the Warrant Amendments involve individuals who are both directors and officers, this transaction is classified as a “related party transaction” as per Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. The Company will be relying on exemptions from formal valuation and minority approval requirements specified in Sections 5.5(a) and 5.7(1)(a) of this instrument. This exemption is applicable as the fair market value of the Warrant Amendments involving these directors and officers does not exceed 25% of the Company’s total market capitalization.

Invitation for Further Inquiry

The Company remains committed to transparency and encourages any interested parties to reach out for further information regarding the Warrant Amendments. Individuals can contact Howard Milne, the Chief Executive Officer, for any inquiries. He can be reached at 604-377-8994 or via email.

Frequently Asked Questions

What are the key changes to the warrants announced by Stearman Resources?

Stearman Resources plans to extend the expiry date of its warrants to September 30, 2025, and amend the exercise price to $0.06.

Who is affected by the Warrant Amendments?

The amendments primarily affect two directors and officers of the Company who hold a combined total of 1,200,000 warrants.

What happens if the share price exceeds the specified amount?

If the closing price of the Company’s shares exceeds $0.075 for ten consecutive trading days, the related warrants could expire within 37 days unless exercised.

Is this transaction considered a related party transaction?

Yes, the Warrant Amendments are classified as a related party transaction since they involve the Company’s directors and officers.

How can investors contact Stearman Resources for more information?

Investors can contact Howard Milne, the CEO, at 604-377-8994 for further details regarding the warrants.

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