Defense Metals Manages Debt with Hatch via Equity Deal
Debt Settlement between Defense Metals and Hatch
In a strategic move, Defense Metals Corp. has entered into a shares-for-debt agreement with Hatch Ltd. to settle outstanding debts. This arrangement marks a significant step for the company as it enhances its financial position while fostering collaboration with a reputable engineering firm.
Details of the Agreement
The agreement allows Defense Metals to settle approximately $846,547.31 owed to Hatch by issuing 5,290,920 common shares at a set price of $0.16 per share. Additionally, the company will grant Hatch 2,645,460 common share purchase warrants. Each warrant entitles Hatch to buy one additional share at a price of $0.21 per share within a 36-month window.
Context Behind the Settlement
Negotiations with Hatch aimed to maintain pricing consistency with previous fundraising efforts. With the share price appreciating recently, regulations dictate a maximum discount of 25%, leading to the current terms of the settlement.
Hold Period and Future Engagement
The newly issued shares and warrants will be subject to a six-month hold period, ensuring compliance with regulatory practices. Furthermore, both parties are working on a side agreement where Defense Metals intends to engage Hatch for engineering services related to the full feasibility study of the Wicheeda Rare Earth Element Project. This project aligns with Defense Metals' commitment to partnering with top-tier engineering firms as they advance towards full project development.
Leadership Remarks
Mark Tory, President and CEO of Defense Metals, expressed satisfaction over the strengthened relationship with Hatch. He noted, "Their acceptance of equity signifies their confidence in the Wicheeda Project’s future. We look forward to our ongoing collaboration to bring this project to fruition." This sentiment underscores the importance of partnerships in the resource development sector.
The Wicheeda Project Overview
Defense Metals is focused on the 100% owned Wicheeda Rare Earth Element property, spanning approximately 11,800 hectares. Situated in an accessible location, the project benefits from proximity to essential infrastructure, including major roads, hydro power lines, and gas pipelines. Recent studies have demonstrated the economic viability of the Wicheeda Project, positioning it as a competitive player in the rare earths market.
Company Information and Contact
For more details, interested parties can visit www.defensemetals.com or reach out to:
Mark Tory
President and CEO
Tel: +1 604-445-8179
Email: mark@defensemetals.com
Frequently Asked Questions
1. What is the recent agreement between Defense Metals and Hatch?
Defense Metals has settled debt owed to Hatch by issuing common shares and warrants, enhancing their financial and collaborative efforts.
2. How many shares is Defense Metals issuing in the agreement?
Defense Metals is issuing 5,290,920 common shares at a price of $0.16 per share.
3. What are the terms of the warrants issued to Hatch?
Hatch will receive 2,645,460 warrants, each allowing them to purchase one share at $0.21 for a period of 36 months.
4. What project will Hatch provide services for?
Hatch will assist with the engineering services needed for the full feasibility study of the Wicheeda Rare Earth Element Project.
5. What is the significance of the Wicheeda Project?
The Wicheeda Project is a pivotal part of Defense Metals' strategy, aimed at tapping into the growing demand for rare earth elements in various industries.
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