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According the company there are no material conditions to closing and gross initial funds of US$850,000 will be advanced to Rainbow within five business days.
Rainbow Rare Earths (LSE:RBW), has announce a new funding agreement, comprising an unsecured convertible security amount of US$750,000 and a 24 month equity facility of up to US$7.0 million.
According the company there are no material conditions to closing and gross initial funds of US$850,000 will be advanced to Rainbow within five business days.
As quoted from the press release:
Highlights
- Lind has agreed to advance up to US$7.75 million to Rainbow during the 24 month term
- Initial proceeds comprising a US$750,000 unsecured convertible security amount and an initial share subscription of US$100,000 from Lind
- The structure is tailored to provide maximum flexibility for Rainbow’s capital requirements during 2019 as production increases, expressly allowing other financing options and the right to pause or terminate the agreement at minimal or no cost
- The funding agreement provides Rainbow with the certainty of a base level of funding, as may be required, over 24 months
- The funding agreement provides for Rainbow to issue Ordinary Shares linked to prevailing market prices, potentially at a premium to the existing share price, thereby minimising dilution for existing shareholders
Martin Eales, CEO of Rainbow, said: “We believe that this agreement with Lind provides the Company with maximum certainty of funds whilst retaining sufficient flexibility to minimise dilution of shareholders where possible. It is an adaptable financing solution well suited to Rainbow, as we seek to increase production from existing mining sites and develop new areas.”
Phillip Valliere, Lind Partners managing director, said: “Lind believes Rainbow is at a critical inflection point and offers a unique investment opportunity: it’s in production, has a long term sales contract and plans to expand production in the near term.”