This press release is issued pursuant to Multilateral Instrument 62-104 - Take-Over Bids and Issuer Bids and National Instrument 62-103 - The Early Warning System and Related Take-Over Bid and Insider Reporting Issues.
Toronto, Ontario--(Newsfile Corp. - February 9, 2021) - On February 8, 2021, Ucore Rare Metals Inc. (TSXV: UCU) (the "Issuer" or "Ucore") closed a non-brokered private placement that Ucore had announced via a press release on January 28, 2021 (the "Offering"). The closing of the Offering consisted of the issuance of an aggregate of 6,700,000 units ("Units") at a subscription price of C$1.00 per Unit, for aggregate gross proceeds to the Issuer of C$6.7 million. Each Unit consists of one common share of Ucore (a "Common Share") and one-half of one Common Share purchase warrant (each whole warrant, a "Warrant"). Following the closing of the Offering, Ucore has 47,749,982 Common Shares issued and outstanding.
At the time of the previous early warning report filed by Concept Capital Management Ltd. ("CCM") in regards to its security holdings in Ucore, which is dated November 6, 2019, CCM directly or indirectly held beneficial ownership of, and control and direction over, a total of 4,389,503 Common Shares and 25,000 Warrants (as adjusted for the Issuer's 1-for-10 share consolidation that occurred on December 11, 2020), representing approximately 12.02% of the issued and outstanding Shares (on a non-diluted basis) or approximately 12.08% upon exercise of the Warrants (assuming the exercise of all of the Warrants beneficially owned by CCM, and that no other securities, including those convertible into, or exercisable for, the Issuer's securities, are issued, converted or exercised).
On May 29, 2020, Ucore announced that it had closed the second and final tranche of a non-brokered private placement of unsecured convertible debentures ("Convertible Debentures"). Pursuant to this offering of Convertible Debentures, Ucore issued 2,800 Convertible Debentures at a price of C$1,000 per debenture for aggregate gross proceeds of C$2.8 million. The Convertible Debentures bear interest at a rate of 7.5%, payable semi-annually on the last day of May and November of each year, commencing on November 30, 2020, and have a three-year term (the "Term"), with the principal amount being due to be repaid in full by the Company on May 31, 2023 (the "Maturity Date"), unless extended. In addition to annual interest at a rate of 7.5%, the Company paid to each initial holder of Convertible Debentures a one-time commitment fee comprised of 50 commitment Warrants per Convertible Debenture (as adjusted for the Issuer's 1-for-10 share consolidation that occurred on December 11, 2020). Each commitment Warrant entitles its holder to acquire one Common Share at an exercise price of C$1.80 per Common Share (as adjusted for the Issuer's 1-for-10 share consolidation that occurred on December 11, 2020) for a period of 24 months. At any time during the Term, a holder of Convertible Debentures may elect to convert the outstanding net principal amount, or any portion thereof, into units ("CD Units") at a conversion price of $1.20 per CD Unit (as adjusted for the Issuer's 1-for-10 share consolidation that occurred on December 11, 2020). Each CD Unit shall consist of one Common Share and one-half of a Warrant, with each whole Warrant entitling the holder to acquire a Common Share at an exercise price of C$1.80 (as adjusted for the Issuer's 1-for-10 share consolidation that occurred on December 11, 2020) for a period ending on the Maturity Date.
Pursuant to the closing of the May 2020 offering of Convertible Debentures, CCM purchased 600 Convertible Debentures (including 30,000 commitment Warrants (as adjusted for the Issuer's 1-for-10 share consolidation that occurred on December 11, 2020)). As at May 29, 2020, CCM's percentage holding of Common Shares was 10.69% of the Company's outstanding Common Shares on a basic undiluted basis and was 11.57% on a diluted basis. Since CCM's acquisition of Convertible Debentures and commitment Warrants represented less than a 2% change in the holdings of the Issuer's Common Shares, an updated early warning report regarding CCM was not triggered pursuant to CCM's participation in the Convertible Debenture offering. Disclosure of CCM's participation was described in the Issuer's material change report that was filed on SEDAR on June 2, 2020.
Accordingly, on January 28, 2021, and immediately prior to the closing of the Offering, CCM directly or indirectly held beneficial ownership of, and control and direction over, 4,389,503 Common Shares, 600 Convertible Debentures (which are convertible into 500,000 CD Units), and 55,000 Warrants, on a post-consolidation basis, representing approximately 10.69% of the issued and outstanding Common Shares (on a non-diluted basis) or approximately 12.41% upon conversion of the Convertible Debentures and exercise of the Warrants (assuming the conversion of all of the Convertible Debentures and the exercise of all of the Warrants beneficially owned by CCM, and that no other securities, including those convertible into, or exercisable for, the Issuer's securities, are issued, converted or exercised).
In connection with the Offering, Ucore issued an aggregate of 1,250,000 Units to CCM, consisting of 1,250,000 Common Shares and 625,000 Warrants.
Accordingly, immediately following the closing of the Offering on February 8, 2021, CCM directly or indirectly held beneficial ownership of, and control and direction over, a total of 5,639,503 Common Shares, 600 Convertible Debentures (which are convertible into 500,000 CD Units), and 680,000 Warrants, representing approximately 11.81% of the issued and outstanding Common Shares (on a non-diluted basis) or approximately 14.37% upon the conversion of the Convertible Debentures and exercise of the warrants (assuming the conversion of all of the Convertible Debentures and the exercise of all of the warrants beneficially owned by CCM, and that no other securities, including those convertible into, or exercisable for, the Issuer's securities, are issued, converted or exercised).
The Units referred to above were acquired by CCM for investment purposes.
CCM and/or one or more of its affiliates may, depending on market and other conditions, increase or decrease its beneficial ownership of Shares or other securities of the Issuer whether in the open market, by privately negotiated agreement, or otherwise.
The Issuer is located at 210 Waterfront Drive, Suite 106, Bedford, Nova Scotia, B4A 0H3. CCM is located at Trust Company Complex, Ajeltake Road, Ajeltake Island, MH 96960, Majuro, Marshall Islands. A copy of the early warning report to which this news release relates can be obtained from CCM via E-mail (info@ccm-ag.com) or telephone +595 2254784, or on the SEDAR profile of the Issuer at www.sedar.com.
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