In a significant financial move, Defense Metals Corp. has officially closed a private placement, securing gross proceeds totaling C$16,153,334. This financing effort comprises both a brokered offering and a non-brokered offering, effectively bolstering the company’s resources for upcoming projects.
With plans to develop the Wicheeda project, Defense Metals aims to utilize these funds to advance its Bankable Feasibility Study scheduled for the first quarter of next year.
Table of Contents:
The facts
The brokered offering, which received enthusiastic investor support, generated C$11,500,200 through the issuance of approximately 38,334,000 units at a price of C$0.30 per unit. The successful full exercise of an option by agents to increase the offering by about 15% contributed to this achievement.
Additionally, the non-brokered offering raised C$4,653,134 with the issuance of 15,510,446 units. The company anticipates a second tranche of this offering, potentially raising an additional C$570,000 shortly.
Units and warrants structure
Each unit sold in the offerings consists of one Class A common share and half of a common share purchase warrant. Holders of these warrants can purchase an additional common share at a price of C$0.45 until October 31, 2028. There is a provision for an accelerated expiry of the warrants should the company’s shares trade at or above $0.90 for ten consecutive trading days.
Leadership insights and future plans
Mark Tory, the CEO of Defense Metals, expressed gratitude for the strong backing received during the offering. He stated, “I am extremely pleased with the level of support in relation to the Offering and would like to thank our financial partners and all of the investors, both existing and new, for their enthusiasm and support.” This sentiment reflects the company’s optimistic outlook as it prepares to advance its operational objectives.
The funds raised will not only support the feasibility study but also assist in optimizing test work on the flow sheet established in their 2025 pre-feasibility study. Additional areas of focus include conducting pilot plant test work, energy studies, and baseline studies needed for future permitting processes.
Insider participation and compliance regulations
Insiders contributed approximately C$670,300 during the non-brokered offering, qualifying as a related party transaction. The company is leveraging exemptions from formal valuation requirements and minority shareholder approval due to the transaction’s limited impact on market capitalization.
According to Canadian securities laws, the issued units to Canadian residents through the listed issuer financing exemption are not subject to a hold period, aside from a standard four-month hold period applicable to certain purchasers.
Future outlook
Looking ahead, Defense Metals is positioned to make significant strides in its Wicheeda project, thanks to the financial influx from the private placements. The focus will be on completing necessary studies and optimizing operational efficiencies as the market for rare earth elements continues to evolve.
With plans to develop the Wicheeda project, Defense Metals aims to utilize these funds to advance its Bankable Feasibility Study scheduled for the first quarter of next year.0
With plans to develop the Wicheeda project, Defense Metals aims to utilize these funds to advance its Bankable Feasibility Study scheduled for the first quarter of next year.1
