Canada Rare Earth Corp. (TSXV:LL) announced that it has entered into a $1,500,000 convertible loan facility with Talaxis Limited.
Canada Rare Earth Corp. (TSXV:LL) announced that it has entered into a $1,500,000 convertible loan facility with Talaxis Limited as a component of the strategic business and financing arrangements with Talaxis announced on January 25, 2018.
Highlights are as follows:
- $800,000 is repayable by the Company 12 months from the date the funds are advanced (the “Advance Date”) and $700,000 is repayable by the Company 24 months from the Advance Date;
- The Lender may convert, in whole or in part, the Loan into units consisting of one common share plus one-half of a warrant (the “Units”), to the extent the Loan has not been repaid, as follows:
- $300,000 at $0.05 per Unit within 12 months of the Advance Date resulting in the issuance of 6,000,000 shares and 3,000,000 warrants;
- $500,000 at $0.075 per Unit within 12 months of the Advance Date resulting in the issuance of 6,666,667 shares and 3,333,333 warrants;
- $533,333 at $0.10 per Unit within 24 months of the Advance Date resulting in the issuance of 5,333,330 shares and 2,666,667 warrants;
- $166,667 at $0.10 per share within 24 months of the Advance Date resulting in the issuance of 1,666,670 shares and no warrants;
- Each full warrant is exercisable for 30 months from the Advance Date into one share of the Company at an exercise price of the greater of (i) 10 cents per share and (ii) the 10 day volume weighted adjusted price determined over the preceding 10 days less15%; and
- Canada Rare Earth may, from time to time, prompt conversion by providing a 15-day notice to payout a minimum of $500,000 before the due date(s). During this notice period, the Lender may exercise its conversion privilege(s).
Peter Shearing, CEO of Canada Rare Earth, commented:
We are pleased to see Talaxis make a strong financial commitment to Canada Rare Earth with the prospect of becoming a major shareholder in our Company. We see this as a very significant indication of their confidence in our business relationship and our ability to realize the strategic goal to be a leading global rare earth provider. This financing allows Canada Rare Earth and Talaxis to accelerate the integration and implementation of our strategy to form a joint rare earth supply chain.