Stock Option Grant and Shares for Debt Settlement
Montreal, January 28, 2021 – Geomega Resources Inc. (“Geomega” or the “Corporation”) (TSX.V: GMA) (OTC: GOMRF) a developer of clean technologies for the mining, refining and recycling of rare earths, announces that the Q2 interim financial statements for the six-month period ended November 30, 2020 have been approved at the Board of Directors meeting (“Board”) which was held on January 27, 2021 and have now been published on SEDAR and on the Corporation’s website.
Stock Option Grants
Other items that were approved at the Board include the grant of 1,350,000 stock options pursuant to the Corporation’s Stock Option Plan, at an exercise price of $0.34 per option, to officers, employees and consultants of the Corporation and its subsidiary. The options to the directors, officers and employees may be exercised for a period of 5 years after the grant date and they vest gradually over a period of 24 months from the day of grant, at a rate of 1/4 per six-month period. The options to consultants may be exercised for a period of 2 years after the grant date and they vest gradually over a period of 12 months from the day of grant, at a rate of 1/4 per three-month period. No stock options were granted at the Annual General Meeting that was held on October 21, 2020.
Shares for Debt Settlement
In connection with the Corporation’s efforts to clean its balance sheet in anticipation of starting production at the demonstration plant, the Corporation announced that it has entered into an agreement to issue shares in settlement of a debt of $47,858 representing accrued interest from a convertible debenture financing which closed on August 13, 2017 and other past consulting services. As consideration for the settlement of the debt, the Corporation will issue a total of 140,754 common shares at a deemed price of $0.34 per share. The convertible debentures, which were subscribed for by several members of the Corporation’s management and directors, carried an interest of 10% per annum, compounded quarterly. The debentures were converted into common shares at a price of $0.12 in August 2019 except for the accrued and compounded interest. Accordingly, this shares for debt settlement includes one current director, Gilles Gingras, and the CEO of the corporation, Kiril Mugerman. This agreement is considered a “related party transaction” under Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions (Québec) (“Regulation 61-101”) and the corresponding Policy 5.9 of the TSXV; however, the proposed settlement with the foregoing insiders is exempt from the formal valuation and minority shareholder approval requirements provided under Regulation 61-101 in accordance with sections 5.5(a) and 5.7(1)(a) of said Regulation 61-101. The exemption is based on the fact that neither the market value of the settlement with the insiders nor the consideration paid therefor exceeds 25% of the Corporation’s market capitalization. The Corporation did not file a material change report at least 21 days prior to the settlement since the transaction was not determined at that moment and the Corporation wished to close the agreement on an expedited basis for sound business reasons.
The settlement is subject to approval by the TSX Venture Exchange.
About Geomega (www.geomega.ca)
Geomega develops innovative technologies for extraction and separation of rare earth elements and other critical metals essential for a sustainable future. With a focus on renewable energies, vehicle electrification, automation and reduction in energy usage, rare earth magnets or neo-magnets (NdFeB) are at the center of all these technologies. Geomega’s strategy revolves around gradually de-risking its innovative technology and delivering cashflow and return value to shareholders while working directly with the main players in these industries to recycle the magnets that power all those technologies.
As its technologies are demonstrated on larger scales, Geomega is committed to work with major partners to help extract value from mining feeds, tailings and other industrial residues which contain rare earths and other critical metals. Irrespective of the metal or the source, Geomega adopts a consistent approach to reduce the environmental impact and to contribute to lowering greenhouse gases emissions through recycling the major reagents in the process.
Geomega’s core project is based around the ISR Technology (Innord’s Separation of Rare Earths), a proprietary, low-cost, environmentally friendly way to tap into a C$1.5 billion global market to recycle magnet production waste and end of life magnets profitably & safely.
Geomega also owns the Montviel rare earth carbonatite deposit, the largest 43-101 bastnaesite resource estimate in North America and holds over 16.8M shares, representing approximately 19% of the issued and outstanding shares, of Kintavar Exploration Inc. (KTR.V), a mineral exploration company that is exploring for copper projects in Quebec, Canada.
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Cautions Regarding Forward-Looking Statements
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains statements that may constitute “forward-looking information” or “forward-looking statements” within the meaning of applicable Canadian securities legislation. Forward-looking information and statements may include, among others, statements regarding future plans, costs, objectives or performance of the Corporation, or the assumptions underlying any of the foregoing. In this news release, words such as “may”, “would”, “could”, “will”, “likely”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate” “target” and similar words and the negative form thereof are used to identify forward-looking statements. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. No assurance can be given that any events anticipated by the forward-looking information will transpire or occur, including as regards the commercialization of any of the technology referred to above, or if any of them do so, what benefits the Corporation will derive. Forward-looking statements and information are based on information available at the time and/or management’s good-faith belief with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond the Corporation’s control. These risks, uncertainties and assumptions include, but are not limited to, those described under “Risk Factors” in the Corporation’s annual management’s discussion and analysis for the fiscal year ended May 31, 2020, which is available on SEDAR at www.sedar.com; they could cause actual events or results to differ materially from those projected in any forward-looking statements. The Corporation does not intend, nor does the Corporation undertake any obligation, to update or revise any forward-looking information or statements contained in this news release to reflect subsequent information, events or circumstances or otherwise, except if required by applicable laws.