TSXV: CSTR
TORONTO, March 8, 2021 /CNW/ - CryptoStar Corp. (TSXV:
CSTR) ("CryptoStar" or the "Company"), a
cryptocurrency mining and data centre operator, is pleased to
announce that, further to the non-binding letter of intent
announced on January 13, 2021, the
Company and a Hong Kong based
company (the "Vendor") have executed an equipment purchase
agreement (the "Definitive Agreement") effective
March 7, 2021 to acquire a
combination of GPU and ASIC miners in exchange for 7,956,198 units
("Units") of the Company at a deemed value of CAD$1,909,487.52 (the "Transaction"). The
Company will issue an additional 477,372 Units (the "Finder's
Fee") to Chen Peifeng in connection with Transaction.
Each Unit consists of one common share of CryptoStar (a
"Common Share") and one common share purchase warrant of
CryptoStar (a "Warrant"). Each Warrant entitles the holder
to acquire one Common Share at a price of CAD $0.36 per Common Share for a period of 18 months
from the date of issue.
The Transaction, including payment of the Finder's Fee, is
subject to TSX Venture Exchange (the "TSXV") approval.
Highlights of the Transaction:
- The Vendor will deliver GPU and ASIC miners capable of a
minimum total Hashrate of 25,950 MH/s and 9,500 TH/s
respectively.
- It is anticipated that the GPU and ASIC miners will be
delivered to CryptoStar's data centres within 30 days.
- The deployment of 25,950 MH/s and 9,500 TH/s of Hashrate using
the latest generation GPU and ASIC miners is expected to contribute
USD$170,051.98 per month in
self-mining revenue for CryptoStar. CryptoStar plans to continue to
further expand its self-mining inventory of mining hardware.
(Source: https://whattomine.com/ Mining metrics are calculated
based on and ETH - USD exchange rate of 1 ETH = $1,741.08 and a BTC - USD exchange rate of 1 BTC
= $51,555.55 updated at 2021-03-08
00:46:13 UTC).
David Jellins, President and
Chief Executive Officer of CryptoStar states, "We are delighted
that the Vendor has selected CryptoStar as its preferred client for
the supply of this highly sought-after GPU and ASIC mining
equipment. We are looking forward to self-mining on a larger scale
and we anticipate that this will be the beginning of a long term
and mutually beneficial relationship."
CryptoStar is also pleased to announce that it has secured
funding commitments of $7.0 million
for a proposed non-brokered private placement (the
"Offering") of 35,000,000 units ("Offered
Units") of the Company at a price of CAD$0.20 per Offered Unit.
Each Offered Unit shall consist of one of Common Share and one
Common Share purchase warrant of CryptoStar (an "Offered
Unit Warrant"). Each Offered Unit Warrant shall entitle the
holder to acquire one Common Share at a price of CAD $0.27 per Common Share for a period of 18 months
following the closing date of the Offering.
The Offering is subject to TSXV approval. The securities issued
in connection with the Offering will be subject to a four-month
hold period, in accordance with applicable securities laws.
It is anticipated that A.C.N. 117 402 838 PTY LTD
("A.C.N."), an insider of the Company, will acquire
16,157,500 Units under the Offering. Any participation by A.C.N. in
the Offering would constitute a "related party transaction" as
defined under Multilateral Instrument 61-101 Protection of
Minority Securityholders ("MI 61-101"). The Company
expects such participation would be exempt from the formal
valuation and minority shareholder approval requirements of MI
61-101 as neither the fair market value of the Units subscribed for
by insiders, nor the consideration for the Units paid by such
insiders would exceed 25% of the Company's market
capitalization.
CryptoStar intends to use the net proceeds from the Offering for
business operations and expansion of its business, to reduce
indebtedness and for general working capital purposes. CryptoStar
may pay a finder's fee to eligible parties in connection with the
Offering, subject to the approval of the TSXV and compliance with
applicable securities laws.
About CryptoStar Corp.:
CryptoStar has cryptocurrency mining operations with data
centres located in the U.S.A. and
Canada. CryptoStar is currently
dedicated to becoming one of the lowest cost cryptocurrency
producers in North America and a
major supplier of GPU and ASIC miners worldwide.
Neither the TSXV nor its Regulation Services Provider (as that
term is defined in the policies of the TSXV) accepts responsibility
for the adequacy or accuracy of this press release.
Forward-Looking Statements
This news release contains forward-looking statements.
Forward-looking statements can be identified by the use of words
such as, "expects", "is expected", "anticipates", "intends",
"believes", or variations of such words and phrases or state that
certain actions, events or results "may" or "will" be taken, occur
or be achieved. Forward-looking statements include those relating
to the Transaction including completion of the Transaction and
approval of the TSXV thereof, the payment of the Finder's Fee, the
time to deliver of the GPU and ASIC miners, the expected revenue
generating capabilities of the GPU and ASIC miners, CryptoStar's
plans to continue its self-mining inventory of mining hardware,
closing of the Offering, approval of the TSXV of the Offering, the
payment of a finder's fee in connection with the Offering and the
use of net proceeds from the Offering. Forward-looking statements
are not a guarantee of future performance and are based upon a
number of estimates and assumptions of management in light of
management's experience and perception of trends, current
conditions and expected developments, as well as other factors that
management believes to be relevant and reasonable in the
circumstances. Actual results, performance or achievement could
differ materially from that expressed in, or implied by, any
forward-looking statements in this press release, and, accordingly,
you should not place undue reliance on any such forward-looking
statements and they are not guarantees of future results.
Forward-looking statements involve significant risks, assumptions,
uncertainties and other factors that may cause actual future
results or anticipated events to differ materially from those
expressed or implied in any forward looking statements. Except as
required by law, CryptoStar undertakes no obligation to publicly
update any forward-looking statements, whether as a result of new
information, future events or otherwise.
SOURCE CryptoStar Corp.
