Commerce Resources Announces Closing of C$2.15 Million Non-Brokered Private Placement of Secured Convertible Notes
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COMMERCE RESOURCES ANNOUNCES CLOSING OF
C$2.15 MILLION NON-BROKERED PRIVATE PLACEMENT OF
SECURED CONVERTIBLE NOTES
Not for distribution to United States news wire services or for dissemination in the United States
May 13, 2025 – Commerce Resources Corp. (“Commerce” or the “Company”) (TSXV: CCE, FSE:
D7H0) is pleased to announce that further to its news release dated April 9, 2025, the Company
has completed its previously announced non -brokered private placement of secured convertible
notes (the “Notes”) for aggregate gross proceeds of approximately C$2,150,000 (the “Offering”).
The Notes accrue interest at a rate of 20.0% per annum, calculated on the basis of the actual number
of days elapsed in an applicable interest period and on the basis of a year of 365 or 366 days, as
the case may be (the “ Interest”) and mature on May 12, 2027 (the “Maturity Date”). Unless
converted or redeemed in accordance with the terms of the Notes, the principal amount of the
Notes (the “ Principal Amount ”) will be owing and accrued Interest due and payable at the
Maturity Date. As previously disclosed, the Company intends to use the proceeds from the
Offering as interim funding to be used for the continuation of studies for the development of the
Ashram Project and for working capital while the Company’s proposed transaction (the
“Transaction”) with Mont Royal Resources Limited, as announced in the news release dated April
8, 2025, is completed.
If the Transaction occurs within 12 months from the date of issuance of the Notes: (i) the Principal
Amount will automatically convert into common shares in the capital of the Company (“Shares”)
at the implied price per Share at which equity securities of the Company or of another issuer are
issued under a financing undertaken in connection with the Transaction (the “ Automatic
Conversion Price”), provided that the Automatic Conversion Price is equal to or greater than
C$0.06 (being Commerce’s closing share price on April 8, 2025); and (ii) the amount representing
the aggregate Interest that would be accrued on the Principal Amount of the Note s for the entire
12-month period beginning on the date of issuance will be accrued but unpaid and shall convert
into Shares in accordance with the Interest Rules (as defined below) (the “Additional Interest
Payment”). For greater certainty, the Additional Interest Payment will only be applicable in the
event of an automatic conversion.
In the event the Transaction is not completed within 12 months from the date of issuance, the
holders of the Notes may, at its sole discretion, elect to convert all of the Principal Amount on the
Maturity Date at the price of C$0.12 per Share (the “ Optional Conversion Price ”) or, at a
conversion price lower than the Optional Conversion Price in the event the Company undertakes
an equity financing lower than the Optional Conversion Price, subject to a minimum conversion
price of C$0.10 (rather than C$0.06 as disclosed in the news release dated April 9, 2025) and the
prior approval of the TSX Venture Exchange (the “TSX-V”). If the Transaction does not proceed
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within 12 months of the date of issuance of the Notes, the holders of the Notes will also have a
pre-emptive right to participate in any equity financing of the Company up to the aggregate amount
of the Principal Amount and Interest outstanding.
The number and terms of any Shares issued in payment of any accrued Interest on the Principal
Amount, Additional Interest Payment and/or other type of interest payments will be based upon a
price per Share that is not less than the closing price of the Shares listed for trading on the TSX-V
at the time such accrued Interest, Additional Interest Payment and/or other type of interest payment
becomes payable and any such payment of accrued Interest , Additional Interest Payment and/or
other type of interest pay ment in Shares shall be subject to prior TSX -V acceptance, with the
application for the TSX -V acceptance to be made by the Company at the time such accrued
Interest, Additional Interest Payment and/or other type of interest payment becomes payable (the
“Interest Rules”).
The Company may redeem the Notes at any time prior to the Maturity Date at a price equal to the
aggregate amount of the Principal Amount owing and accrued Interest outstanding and a cash
amount equal to the sum of half of all payments of interest that would be due through the Maturity
Date after redemption.
The Notes are secured under a general security agreement and rank pari-passu as between
themselves and all holders of Notes have entered into an interlender agreement in connection
therewith. The Notes and the underlying Shares issuable thereunder, are subject to a statutory hold
period of four (4) months plus one (1) day following the closing of the Offering.
In connection with the Offering, the Company paid to Alpha Node Capital Pty Ltd. (the "Finder")
a cash finder's fee in the amount of $66,000, representing 6% of $1.1 million placed by the Finder.
The Company also issued 1,100,000 finder's warrants (the "Finder Warrants") attributable to the
$1.1 million placed by the Finder. Each Finder Warrant is exercisable to acquire one Share of the
Company until May 12, 2028, at an exercise price of $0.075 per Share. All Shares and Finder’s
Warrants issued in relation to these finder’s fees are subject to a hold period expiring four (4)
months plus one (1) day following the closing of the Offering.
Closing of the Offering is subject to final acceptance by the TSX-V.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any
securities in the United States or to any “U.S. Person” (as such term is defined in Regulation S
under the U.S. Securities Act of 1933, as amended (the “ U.S. Securities Act”)) of any equity or
other securities of the Company. The securities described herein have not been, and will not be,
registered under the U.S. Securities Act or under any state securities laws and may not be offered
or sold in the United States or to a U. S. Person absen t registration under the 1933 Act and
applicable state securities laws or an applicable exemption therefrom. Any failure to comply with
these restrictions may constitute a violation of U.S. securities laws.
About Commerce Resources Corp.
Commerce Resources Corp. is a junior mineral resource company focused on the development of
the Ashram Rare Earth and Fluorspar Deposit located within their Eldor Property, in northern
Quebec, Canada. The Ashram Deposit is characterized by simple rare earth (monazite, bastnaesite,
xenotime) and gangue (carbonates) mineralogy, a large tonnage resource at favourable grade, and
has demonstrated the production of high-grade (more than 30 – 45% TREO) mineral concentrates
at high recovery (more than 60 – 75%) in line with active global producers.
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The Ashram Deposit also has a fluorspar component which makes it one of the largest potential
sources of fluorspar in the world and could be a long -term supplier to the met-spar and acid-spar
markets. The Company is positioning to be one of the lowest cost rare earth producers globally
with a specific focus on being a long -term supplier of mixed rare earth carbonate and/or NdPr
oxide to the global market.
Additionally, Commerce is committed to exploring the potential of other high-value commodities
on the Ashram Property such as niobium and phosphate minerals, which may help advance Ashram
by reducing costs through shared development.
For more information, please visit the corporate website at www.commerceresources.com or email
On Behalf of the Board of Directors
COMMERCE RESOURCES CORP.
Ian Graham
Chairman
Tel: 604.484.2700
Email: [email protected]
Web: http://www.commerceresources.com
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in
policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this
release.
Forward-Looking Statements
This news release contains forward -looking statements, which includes any information about
activities, events or developments that the Company believes, expects or anticipates will or may
occur in the future. Forward looking statements in this news release include statements regarding
the proposed Transaction and the terms thereof; the intended use of proceeds of the Offering; the
conversion of the Notes and the Obligations, as applicable; the continued advancement of the
Ashram Project to development; that Ashram’s fluorspar component which makes it one of the
largest potential sources of fluorspar in the world and c ould be a long -term supplier to the met -
spar and acid-spar markets; that the Company is positioning to be one of the lowest cost rare earth
element producers globally, with a focus on being a long-term global supplier of mixed rare earth
carbonate and/or NdPr oxide; and that the Company may explore the potential of other high-value
commodities on the Ashram Property. These forward-looking statements are subject to a variety
of risks and uncertainties and other factors that could cause actual events or results to differ
materially from those projected in the forward -looking information. Risks that could change or
prevent these events, activities or developments from coming to fruition include: the ability to
obtain approvals in respect of the Transaction and to consummate the Transaction, ability to
consummate any equity financing in connection with the Transaction, actual results of current and
future exploration activities; that the Company may not be able to fully finance any additional
exploration on the Ashram Project; that even if the Company is able raise capital, costs for
exploration activities may increase such that the Company may not have sufficient funds to pay
for such exploration or processing activities; the timing and content of the proposed drill program
and any future work programs may not be completed as proposed or at all; geological
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interpretations based on drilling that may change with more detailed information; potential process
methods and mineral recoveries assumptions based on limited test work and by comparison to what
are considered analogous deposits that, with further test work, may not be comparable; testing of
our process may not prove successful or samples derived from the Ashram Project may not yield
positive results, and even if such tests are successful or initial sample results are positive, the
economic and other outcomes may not be as expected; the anticipated market demand for rare earth
elements and other minerals may not be as expected; the availability of labour and equipment to
undertake future exploration work and testing activities; geopolitical risks which may result in
market and economic instability; and despite the current expected viability of the Ashram Project,
conditions changing such that even if metals or minerals are discovered on the Ashram Project,
the project may not be commercially viable, or other risks detailed herein and from time to time in
the filings made by the Company with applicable Canadian securities regulators. Althou gh the
Company has attempted to identify important factors that could cause actual actions, events or
results to differ from those described in forward -looking statements, there may be other factors
that cause such actions, events or results to differ materially from those anticipated. These forward-
looking statements are based on our current expectations, estimates, forecasts and projections
about our business and the industry in which we operate and management’s beliefs and
assumptions, including the non-occurrence of the risks and uncertainties that are described above
and in the filings made with the applicable Canadian securities regulators or other events occurring
outside of our normal course of business, and are not guarantees of future performance o r
development and involve known and unknown risks, uncertainties and other factors that are in
some cases beyond our control. There can be no assurance that such statements will prove to be
accurate, as actual results and future events could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on forward-looking statements.
The forward-looking statements contained in this news release are made as of the date hereof and
the Company assumes no responsibility to update or revise such information to reflect new events
or circumstances, except as required by law.