Rainbow Rare Earths has secured a new funding agreement, comprising an unsecured convertible security amount of $750 000 and a 24-month equity facility of up to $7-million, with an entity managed by The Lind Partners.
There are no material conditions to closing and gross initial funds of $850 000 will be advanced to Rainbow within five business days.
The funding agreement provides Rainbow with the certainty of a base level of funding, as may be required, over 24 months.
The funding agreement also provides for Rainbow to issue ordinary shares linked to prevailing market prices, potentially at a premium to the existing share price, thereby minimising dilution for existing shareholders.
In a statement published on Monday, Rainbow CEO Martin Eales indicated that this was an adaptable financing solution that was well suited to Rainbow, with the company seeking to increase production from existing mining sites and developing new areas.
“Lind believes Rainbow is at a critical inflection point and offers a unique investment opportunity. It’s in production, has a long-term sales contract and plans to expand production in the near term,” said Lind MD Phillip Valliere.