Ucore Initiates Acquisition of IBC

Halifax, Nova Scotia--(Newsfile Corp. - February 14, 2019) - Ucore Rare Metals Inc. (TSXV: UCU) (OTCQX: UURAF) ("Ucore" or the "Company") is pleased to announce that earlier this morning the Company issued the Notice of Commencement ("NOC") to purchase IBC Advanced Technologies, Inc. ("IBC") as prescribed by the terms previously agreed to by Ucore, IBC, and the majority shareholders of IBC, and as embodied in the Option to Purchase Agreement dated March 14, 2015, as amended (the "OTP Agreement").

The delivery of the NOC initiates a 60-day period review during which Ucore has the right to conduct a detailed due diligence review of IBC's operations and financial records (the "Due Diligence"). At any time during this review Ucore has the right to issue to IBC a Notice of Positive Due Diligence ("NOP"), which triggers the closing process designed to transfer ownership of the controlling stake in IBC to Ucore (the "Closing Process").

"Ucore is very pleased to announce to our shareholders that the acquisition process of IBC Advanced Technologies has now commenced," said Jim McKenzie, President & CEO of Ucore. "IBC has over 30 years of history, and extensive intellectual property in regards to the commercialization of supramolecular technology for the mining industry. With installations around the world and with an active revenue base, IBC offers an excellent platform for the provision of precision extraction methodologies to the mining industry. The value of IBC as a strategic asset speaks for itself. Ucore has positioned itself to absorb this asset, and financing discussions have commenced in contemplation of the acquisition expense."

"The acquisition of IBC will transition Ucore to active revenue bearing status, and progressively away from reliance on the capital markets," continued McKenzie. "This is a pivotal point that all development stage enterprises seek, and we're delighted to inform that the intended transition has now been initiated. Ucore would like to take this opportunity to assure its shareholders that its claim to IBC under the terms negotiated in 2015 and 2016, remains not only secure and enforceable, but has now in fact transitioned into an active buyout process."

"The commencement of the acquisition of IBC will enable Ucore to take the Alaska SMC project, and more specifically our first revenue generating project, in a direction dictated by the market," said Mike Schrider, Ucore COO. "Based on our confidence in the expected support Ucore will receive in regard to proceeding with the Alaska SMC, we have elected to extend our purchase agreement on our Ketchikan land package to September 2019. This is an exciting time for Ucore. We thank our shareholders for supporting us as we bring this asset home."

Closing Process

The Closing Process comprises a 60-day period in which the parties are required to complete a purchase agreement (the "Purchase Agreement") to affect the transfer of ownership of IBC to Ucore (the "Purchase Transaction").

If for any reason the Parties cannot agree on the terms of a Purchase Agreement; Ucore shall have the right in its sole discretion to:

1. Arbitration - Require the Parties to submit to binding arbitration proceedings where the arbitrator will resolve any disputes and/or, if requested by Ucore, will select the most reasonable terms for the Purchase Agreement and support documents based upon the intent of the OTP Agreement;
2. Continuance - Continue the OTP Agreement until such time as a mutually agreeable Purchase Agreement and support documents can be arrived at between the Parties; or
3. Termination - Terminate the OTP Agreement immediately with no further obligations by Ucore.

The Company reports that it does not intend to terminate the OTP Agreement. The Company further informs that it intends to enforce arbitration proceedings if deemed necessary in its discretion. Subsequent to the Company's initiation of a court application in Nova Scotia per Ucore press release dated December 11, 2018, IBC filed a complaint in the State of Utah concerning Ucore's representations and claims against IBC intellectual properties, and the parties are in the process of reviewing and pursuing these respective actions. As previously reported, IBC has officially requested that the Company waive its rights under the OTP Agreement. The Company has already responded that it does not intend to do so, and has the full intention of completing the terms of the OTP Agreement, as mandated by major shareholders and backers such as Orca.

Terms of OTP Agreement

The relevant terms of the OTP Agreement and the relationship of the parties are as follows:

Purchase Price: USD$10 million for 100% of IBC shares, to be paid in either cash or shares of Ucore, at the discretion of each IBC shareholder. The IBC shareholder base is diverse and comprised of multiple individuals and entities. The actual cash requirement may be less than the foregoing amount, depending on the number and proportion of shareholders who elect to obtain shares in Ucore in lieu of cash. No single IBC shareholder will acquire a control position in Ucore pursuant to this transaction.

Key Person Incentive Units: 4 million units of Ucore, to be paid to current IBC Key Persons. Each unit to consist of one common share of the Company plus ½ Common Share Purchase Warrant. Each Common Share Purchase Warrant shall have a strike price equal to the market price of the Company's shares as of the date on which the Purchase Agreement is signed and shall have a term of three years from the date of issue.

Ongoing Performance Incentives: Following the execution of the Purchase Agreement, current IBC employees shall receive performance incentives totaling 7% of IBC's annual EBITDA for each of the first 5 years of operations.

Consideration: Consideration paid by Ucore for the OTP Agreement totaled USD$650,000, comprised of USD$300,000 pursuant to the OTP Agreement dated March 14, 2015, plus an additional USD$350,000 pursuant to an agreement to extend the term of the OTP Agreement dated June 1, 2016. In total, the consideration equates to approximately CAD$850,000.

Payments Under Previous Agreements: Payments totaling USD$2.9 million pursuant to previous agreements between Ucore and IBC must be completed prior to the closing of the Purchase Transaction. To date, Ucore has made advance payments totaling USD$1.9 million against this amount.

IBC Shareholder Support: Shareholders representing the majority of the outstanding shares of IBC were solicited by IBC to become a party to and sign the OTP Agreement as well as the Extension Agreement, indicating their support for the Purchase Transaction, with a sufficient percentage of the voting shares of IBC for Ucore to issue the NOC and pursue the completion of the transaction. Ucore will take active measures to ensure that all IBC shareholders are given the opportunity to participate in the final Purchase Transaction.

Financing & Approval

Both the expected future financing to fund the purchase of IBC and the completion of the Purchase Transaction are subject to and conditional upon the approval of the TSX Venture Exchange in accordance with its regulations and policies.

About Ucore

Ucore Rare Metals is a development-phase company focused on rare metals resources, extraction and beneficiation technologies with near term potential for production, growth and scalability. The Company has a 100% ownership stake in the Bokan-Dotson Ridge Rare Earth Project. On March 31, 2014, Ucore announced the unanimous support of the Alaska State Legislature for Senate Bill 99 (2014), which authorized the AIDEA to issue up to USD $145 Million in bonds for the infrastructure and construction costs of the Bokan-Dotson Ridge Rare Earth Project.

For further information, please contact Mr. Jim McKenzie, President & CEO of Ucore Rare Metals Inc. at: +1 (902) 482-5214 or visit http://www.ucore.com.

Cautionary Notes

This press release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future financing and/or business acquisition activities, timelines, events or developments that the Company expects, 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 or results and actual results or developments may differ materially from those in forward-looking statements. Ucore has assumed that it will in the near future be able to obtain interim financing and sufficient additional financing to acquire IBC in compliance with the terms contemplated in the existing agreements with IBC and its shareholders holding a majority of its shares. Ucore has also assumed that there will be no material adverse findings in its upcoming expected comprehensive due diligence review of IBC. Factors that could cause actual results to differ materially from those in forward-looking statements include: Ucore not being able to raise sufficient funds to acquire IBC (including the non-acquisition payments owed under the previous and existing agreements); adverse capital market conditions; unexpected due diligence findings; unexpected or adverse outcomes in the currently outstanding litigation matters between Ucore and IBC; resistance to or non-compliance by IBC or its key shareholders with the existing agreements; the emergence of alternative superior metallurgy and mineral separation technologies; the inability of IBC to retain its key staff members and clients; the inability of IBC to protect its intellectual property; unexpected transaction costs or other deal completion setbacks; the availability and procurement of any required interim financing that may be required; and general economic, market or business conditions.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined by the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/42843