#Canada #Vancouver #Defense Metals #Wicheeda Project #Rare Earth Elements

Defense Metals Corp. Unveils New Financing Efforts

Defense Metals Corp., listed on TSX Venture under the ticker DEFN, recently made a significant announcement regarding its financing strategy aimed at supporting the development of its Wicheeda Rare Earth Element (REE) Project located in British Columbia. On April 24, 2025, the company disclosed that it has entered into an agreement with Paradigm Capital Inc., which will act as the lead agent for a proposed "best efforts" private placement financing. This initiative is anticipated to raise up to approximately $8 million.

The financing will consist of two types of units: flow-through units and hard dollar units. The company aims to issue up to 11,765,000 flow-through units priced at $0.17 each and up to 40,000,000 hard dollar units at $0.15 each. Each flow-through unit will provide a common share alongside a half warrant, while hard dollar units will provide a similar structure. The underlying aim is to fund eligible expenditures related to the Wicheeda Project, which is situated on traditional lands of the McLeod Lake Indian Band.

Project Background

The Wicheeda Project is an essential part of Defense Metals’ strategy. Positioned approximately 80 kilometers (50 miles) northeast of Prince George, British Columbia, the project boasts excellent accessibility via paved roads and existing infrastructure, including hydro power and gas pipelines. Recent studies indicate robust economic potential, enhancing its viability in the burgeoning REE market.

The proceeds from the offering will be utilized for various operational expenses, specifically eligible flow-through expenditures, alongside sustaining progress on design optimization, environmental studies, and permitting processes. These aims align with the company’s broader vision to expedite the project’s development timeline.

Compensation for Agents

As part of this financing arrangement, the agents involved will receive a cash commission of 7% of the gross proceeds from the offering. Additionally, options will be granted allowing the agents to acquire shares equivalent to 7% of the number of securities issued, thereby aligning their interests with the successful completion of the financing.

Future Outlook

The offering is not just limited to the flow-through and hard dollar units. The company anticipates a concurrent non-brokered financing initiative to raise an additional $1 million. This dual strategy aligns with the company’s goal to ensure adequate funding is available to meet both operational needs and project development milestones.

Defense Metals is optimistic about the potential participation of insiders in this capital raise, which may constitute a related party transaction as defined by securities regulations. However, the company plans to take necessary precautions, relying on exemptions regarding insider participation to maintain fairness and transparency.

The offerings will be executed in compliance with existing securities laws across several jurisdictions, including specific regulations in Canada and the United States. Importantly, these securities have not been and will not be registered under U.S. Securities Act laws, meaning they cannot be sold without compliance with applicable exemptions.

In summary, Defense Metals Corp. is taking strategic steps through this financing plan to fortify its position in the REE market. The developments at the Wicheeda Project reflect a broader trend towards securing rare earth elements critical for various technological advances, positioning the company for future growth and sustainability. With the expected closing date around May 12, 2025, stakeholders are keenly watching the unfolding events as the company moves closer to realizing its operational goals and enhancing its market presence.