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VANCOUVER, BC, May 25, 2023
/CNW/ - Defense Metals Corp. ("Defense Metals" or the
"Company"); (TSXV: DEFN) (OTCQB: DFMTF) (FSE: 35D) is
pleased to announce that, further to its news release of
April 27, 2023, it has closed its
non-brokered private placement financing (the "LIFE
Offering") of 22,367,977 common shares of the Company
("Common Shares") at a price of $0.26 per Common Share, and the Concurrent
Placement (as defined below) of 25,708,946 Common Shares at the
same issue price, for aggregate gross proceeds of C$12.5 million (the Life Offering, collectively
with the Concurrent Placement, the "Offering"). The
Concurrent Placement includes a lead order from RCF Opportunities
Fund II L.P. ("RCF Opps II"), consisting of 25,552,380
Common Shares for gross proceeds of C$6.6
million. John Robins of
Discovery Group and Strategic Advisor to the Company, also
participated in the Offering.
Craig Taylor, CEO of Defense
Metals, commented:
"We are very pleased to welcome RCF Opps II
as a key shareholder. We will continue to advance the Wicheeda
Light Rare Earth Elements project and we look forward to working
with the many stakeholders. We believe the Wicheeda Light Rare
Earth Elements project is the best rare earths project in
Canada and one of the best
developing REE projects globally."
Subject to compliance with applicable regulatory requirements
and in accordance with National Instrument 45-106 – Prospectus
Exemptions ("NI 45-106"), the Common Shares issued
pursuant to the LIFE Offering were offered for sale to purchasers
resident in Canada, except
Quebec, and/or other qualifying
jurisdictions pursuant to the listed issuer financing exemption
under Part 5A of NI 45-106 (the "Listed Issuer Financing
Exemption"), which Common Shares are not subject to a hold
period pursuant to applicable Canadian securities laws. In
connection with the Listed Issuer Financing Exemption, the Company
filed an offering document dated April 27,
2023 on SEDAR under the Company's profile at www.sedar.com
and on the Company's website at www.defensemetals.com.
In addition to the LIFE Offering, the Company completed a
concurrent non-brokered private placement to purchasers pursuant to
applicable exemptions under NI 45-106 (the "Concurrent
Placement"). The Common Shares issued pursuant to the
Concurrent Placement are subject to a statutory hold period of four
months and one day in accordance with applicable Canadian
securities laws.
In connection with the Offering, the Company paid aggregate cash
finder's fees of $211,056 and issued
2,311,753 non-transferable common share warrants (the
"Warrants"). The Warrants are exercisable at $0.32 per Common Share for a period of two years
from the closing date of the Offering.
Notably, RCF Opps II subscribed as lead order in the Concurrent
Placement, for approximately C$6.6
million for 25,552,380 Common Shares, representing
approximately 9.99% of the issued and outstanding common shares of
Defense Metals upon completion of the Offering. In consideration
for RCF Opps II agreeing to subscribe as lead order in the
Concurrent Placement, RCF Opps II was granted the right to
participate in subsequent equity or debt financings of the Company
on a pro rata basis based on RCF Opps II's ownership stake
(determined on a partially diluted basis immediately prior to the
proposed financing), while RCF Opps II's ownership in the Company
is greater than or equal to 5% (determined on a partially diluted
basis).
The Company intends to use the net proceeds of the Offering to
advance the Company's wholly-owned Wicheeda Rare Earth Elements
Project ("Wicheeda") including: (i) the completion of the
ongoing pre-feasibility study work; (ii) regional exploration
activities; and (iii) general working capital and corporate
expenses.
The Common Shares of the Company have not been, and will not be,
registered under the U.S. Securities Act of 1933, as amended (the
"U.S. Securities Act"), or any U.S. state securities laws
and may not be offered or sold in the
United States absent registration or an available exemption
from the registration requirements of the U.S. Securities Act and
applicable U.S. state securities laws. This press release shall not
constitute an offer to sell or the solicitation of an offer to buy,
nor shall there by any sale of the securities referenced in this
press release, in any jurisdiction in which such offer,
solicitation or sale would be unlawful.
Qualified Person
The scientific and technical information contained in this news
release has been reviewed and approved by Kristopher J. Raffle,
P.Geo. (B.C.), Principal and Consultant of APEX Geoscience Ltd. of
Edmonton, Alberta, who is a
director of Defense Metals and a "Qualified Person" as defined in
National Instrument 43-101.
About the Wicheeda REE
Property
Defense Metals 100% owned, 4,262-hectare (~10,532-acre) Wicheeda
Light REE property is located approximately 80 km northeast of the
city of Prince George, British
Columbia; population 77,000. The Wicheeda REE Project is
readily accessible by all-weather gravel roads and is near
infrastructure, including hydro power transmission lines and gas
pipelines. The nearby Canadian National Railway and major highways
allow easy access to the port facilities at Prince Rupert, the closest major North
American port to Asia.
The 2021 Wicheeda REE Project Preliminary Economic Assessment
technical report ("PEA") outlined a robust after-tax net present
value (NPV@8%) of $517 million and an
18% IRR1. This PEA contemplated an open pit mining
operation with a 1.75:1 (waste:mill feed) strip ratio providing a
1.8 Mtpa ("million tonnes per year") mill throughput producing an
average of 25,423 tonnes REO annually over a 16 year mine life. A
Phase 1 initial pit strip ratio of 0.63:1 (waste:mill feed) would
yield rapid access to higher grade surface mineralization in year 1
and payback of $440 million initial
capital within 5 years.
About Defense Metals
Corp.
Defense Metals Corp. is focused on the development of its
100% owned Wicheeda Project that contains Rare Earth Elements that
are commonly used in the defense industry, national security sector
and in the production of green energy technologies, such as, rare
earths magnets used in wind turbines and in permanent magnet motors
for electric vehicles.
Defense Metals Corp. trades in Canada under the symbol "DEFN" on the TSX
Venture Exchange, in the United
States under "DFMTF" on the OTCQB, and in Germany on the Frankfurt Exchange under
"35D".
Defense Metals is a proud member of Discovery Group. For more
information please visit: http://www.discoverygroup.ca/
For further information, please visit www.defensemetals.com
or contact:
Todd Hanas, Bluesky Corporate
Communications Ltd.
Vice President, Investor Relations
Tel: (778) 994 8072
Email: todd@blueskycorp.ca
Neither the 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.
Cautionary Statement Regarding
"Forward-Looking" Information
This news release contains "forward–looking information or
statements" within the meaning of applicable securities laws, which
may include, without limitation, statements relating to the use of
proceeds of the Offering, advancing the Wicheeda REE Project, the
expected completion of the pre-feasibility study on the Wicheeda
REE Project, completing regional exploration on the Wicheeda REE
Project, the technical, financial and business prospects of the
Company, its project and other matters. All statements in this news
release, other than statements of historical facts, that address
events or developments that the Company expects to occur, are
forward-looking statements. Although the Company believes the
expectations expressed in such forward-looking statements are based
on reasonable assumptions, such statements are not guarantees of
future performance and actual results may differ materially from
those in the forward-looking statements. Such statements and
information are based on numerous assumptions regarding present and
future business strategies and the environment in which the Company
will operate in the future, including the price of rare earth
elements, the anticipated costs and expenditures, the ability to
achieve its goals, that general business and economic conditions
will not change in a material adverse manner, that financing will
be available if and when needed and on reasonable terms. Such
forward-looking information reflects the Company's views with
respect to future events and is subject to risks, uncertainties and
assumptions, including the risks and uncertainties relating to the
interpretation of exploration and metallurgical results, risks
related to the inherent uncertainty of exploration and development
and cost estimates, the potential for unexpected costs and expenses
and those other risks filed under the Company's profile on SEDAR at
www.sedar.com. While such estimates and assumptions are considered
reasonable by the management of the Company, they are inherently
subject to significant business, economic, competitive and
regulatory uncertainties and risks. Factors that could cause actual
results to differ materially from those in forward looking
statements include, but are not limited to, continued availability
of capital and financing and general economic, market or business
conditions, adverse weather and climate conditions, failure to
maintain or obtain all necessary government permits, approvals and
authorizations, failure to maintain community acceptance (including
First Nations), risks relating to unanticipated operational
difficulties (including failure of equipment or processes to
operate in accordance with specifications or expectations, cost
escalation, unavailability of personnel, materials and equipment,
government action or delays in the receipt of government approvals,
industrial disturbances or other job action, and unanticipated
events related to health, safety and environmental matters), risks
relating to inaccurate geological, metallurgical and engineering
assumptions, decrease in the price of rare earth elements, the
impact of COVID-19 or other viruses and diseases on the Company's
ability to operate, an inability to predict and counteract the
effects of COVID-19 on the business of the Company, including but
not limited to, the effects of COVID-19 on the price of
commodities, capital market conditions, restriction on labour and
international travel and supply chains, loss of key employees,
consultants, or directors, increase in costs, delayed results,
litigation, and failure of counterparties to perform their
contractual obligations. The Company does not undertake to update
forward–looking statements or forward–looking information, except
as required by law.
___________
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1
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Independent Preliminary
Economic Assessment for the Wicheeda Rare Earth Element Project,
British Columbia, Canada, dated January 6, 2022, with an effective
date of November 7, 2021, and prepared by SRK Consulting (Canada)
Inc. is filed under Defense Metals Corp.'s Issuer Profile on SEDAR
(www.sedar.com).
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SOURCE Defense Metals Corp.