Canadian Metals Announces a Five Year Extension and Amendment of Convertible Debentures
Canadian Metals Inc. CSE: CME
Canadian Metals Announces a Five Year Extension and Amendment of
Convertible Debentures
December 18, 2020 Montréal, Québec. – Canadian Metals Inc. ( “CME” or the “Corporation”)
(CSE: CME ) is pleased to announce that it has given the opportunity to the holders (the
“Holders”) of its $1.675 million subordinated unsecured convertible debentures (the
“Outstanding Debentures ”), as amended, to subscribe for new subordinated unsecured
convertible debentures (the “New Debentures”).
All the holders of Outstanding Debentures have entered into binding subscription agreements
for $1.675 million of the New Debentures.
Stéphane Leblanc , President and CEO, stated, “The holders of the existing debentures
expressed strong support to exten d the facility, and this significantly strengthens our balance
sheet going forward.”
The Outstanding Debentures have been substituted for a new principal amount equal to the
principal amount of the Outstanding Debentures, with such novation to be effecti ve
on December 18, 2020 (the “Closing Date”).
CME issued New Debentures in the aggregate maximum principal amount of $ 1.675 million.
The New Debentures have an issue price of $1,000 per New Debenture, mature on March 31,
2025, bear interest at 3 % per an num, payable on March 31 of each year while outstanding,
which interest, subject to regulatory approval, may at the option of the Corporation be settled in
common shares. The principal amount of the New Debentures will be convertible into common
shares ( “Conversion Shares”) of the Corporation at the price of $0.40 per Conversion Share
(the “Conversion Price”). The New Debentures and, if issued within four months of the date of
issue of the New Debentures, the Conversion Shares, will be subject to a four mon th hold
period from the date of issuance of the New Debentures, in accordance with applicable
Canadian securities laws. The offering of the New Debentures is subject to the approval of the
Canadian Securities Exchange.
Notwithstanding the foregoing, the Corporation shall pay to the Holders interest in the amount of
3% per annum on the principal amount of the Outstanding Debentures for the period from
January 1, 2020 to June 30, 2020, such interest being payable on the closing date of the Private
Placement (as defined below) and the first interest payment pursuant to the New Debentures
shall be calculated for the period commencing on July 1, 2020 and ending on the date
preceding March 31, 2021.
The Corporation may redeem the New Debentures in cash on not more than 60 days ’ and not
less than 30 days ’ notice prior to the date fixed for redemption , in whole or in part from time to
time, upon required prior notice at a redemption price equal to their principal amount p lus
accrued and unpaid interest.
Furthermore, the Corporation shall redeem the New Debentures in amounts that are
proportionate to the number of issued and outstanding New Debentures, out of fifty percent
(50%) out of the amount of all revenues that the Corporation receives from Les Minéraux
Industriels du Québec Inc.
Additionally, in the event the Corporation launches a commercial silicon metals smelter project
at any time prior to the redemption of the New Debentures and such project reaches
commercial production, it shall pay a premium equal t o ten pe rcent (10%) of the outstanding
principal amount of the New Debentures.
Private Placement
Further to its September 25, 2020 press release, the Corporation expects to close its non-
brokered private placement (the “Private Placement”) of units at a price of $0.08 per Unit.
Related Party Transaction
Certain insiders of the Corporation subscribed for a total of $41,000 of the New Debentures ,
which is a “related party transaction ” within the meaning of Multilateral Instrument 61 -101
Protection of Minority Security Holders in Special Transactions ( “MI 61-101”). The issuances to
the insiders are exempt from the valuation requirement of MI 61 -101 by virtue of the exemption
contained in section 5.5(b) as the Corporation’s shares are not listed on a specifi ed market and
from the minority shareholder approval requirements of MI 61 -101 by virtue of the exemption
contained in section 5.7(a) of MI 61 -101 in that the fair market value of the consideration of the
securities issued to the related parties did not ex ceed 25% of the Corporation’s market
capitalization. The Corporation did not file a material change report more than 21 days befo re the
expected closing of the private placement as the details of the private p lacement and the
participation therein by related parties of the Corporation were not settled until shortly prior to closing
and the Corporation wished to close on an expedited basis for sound business reasons.
About Canadian Metals Inc.
Canadian Metals is a diversified resource Corporation focused on creating shareholder value
through the development of large -scale mineral deposits in specific commodities and safe
jurisdictions.
For more information, please contact:
Stéphane Leblanc
President and CEO
Website: www.canadianmetalsinc.com
Neither the CSE nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy
of this release.