Canada Rare Earth - In the Business of Rare Earths - Talaxis Converting Its Entire Debt Fac
June 17, 2019
Talaxis Converting Its Entire Debt Facility Into Canada Rare Earth Equity
Canada Rare Earth Corp. (“Canada Rare Earth” or the “Company”) (TSX.V: LL) is pleased to announce that Talaxis Limited is converting its entire convertible debt position into equity of Canada Rare Earth.
Tracy A. Moore, CEO of Canada Rare Earth noted, “This conversion is very beneficial to the Company and is a clear demonstration of Talaxis’ commitment to Canada Rare Earth and our strategy in the rare earth market.”
In January 2018, Canada Rare Earth entered into a $1.5 million funding arrangement with its strategic partner, Talaxis Limited. In August 2018, $300,000 was converted at 5 cents per unit (“Unit”) into 6 million Units. Each Unit is comprised of one common share and one-half warrant. Each full warrant is exercisable into one common share at a minimum of 10 cents until July 31, 2020.
With the recent development:
- $500,000 of debt, due July 31, 2019, is being converted on original terms at 7.5 cents per Unit into 6,666,666 Units;
- $700,000 of debt, due January 31, 2020, is being converted at 8.5 cents into 5,333,334 Units and 2,901,960 common shares common shares. This conversion price was established at a price at or above market although below the original 10 cent conversion price. Conversion at this time saves the Company approximately $63,000 of interest that would have otherwise been payable if this portion of the loan was repaid on the due date;
- Additionally, Talaxis Limited is converting $53,260 of interest accrued since January 31, 2019 at 7.5 cents per share into 710,133 shares
With the August 2018 conversion and the conversions announced herein, Talaxis Limited will hold 21,612,093 shares (10.86% of the then total number of issued shares) and 9,000,000 warrants.
The Canada Rare Earth Board of Directors has agreed to allow Talaxis Limited to appoint one member to the board so long as it holds 10% or more of the Company’s issued shares.
The most recent conversion is subject to regulatory approval.
ABOUT CANADA RARE EARTH CORP.
Canada Rare Earth is generating revenues and gross profits as we develop our integrated supply chain business based on the rare earth industry and with increasing attention directed to valuable by-products. Our business involves sourcing, adding value and selling rare earths and other mineral products in all stages and forms utilizing proprietary, affiliated and third-party sources and facilities.
On behalf of the Board
Tracy A. Moore, CEO and Peter Shearing, COO
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. Forward-looking statements in this release are made pursuant to the ‘safe harbour’ provisions of the Private Securities Litigation Reform act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties.
For more information on the Company, interested parties should review the Company's filings that are available at www.sedar.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Tracy A. Moore
Chief Executive Officer
Chief Operating Officer
Telephone: (604) 638-8886