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LONDON (Alliance News) - Rainbow Rare Earths Ltd said Monday that Lind Partners LLC had requested the full conversion of a USD900,000 loan facility, resulting in it having to issue 26 million shares, more than 10% of its existing total.
The Burundi-focused miner explained that Lind had asked that its entire USD900,000 convertible loan, announced back in late January, be converted to shares. Rainbow will thus issue 26.3 million shares at a conversion price of 2.69 pence each.
Shares in Rainbow were 4.6% lower at 6.82 pence on Monday.
Rainbow noted however that there was a limit to how many shares it could issue in a 12 month period without publishing a prospectus.
Consequently, Rainbow will issue Lind 8.4 million shares immediately. The remaining 17.8 million shares will be handed to Lind following a prospectus to be published in July.
After trading has begun for the initial 8.4 million shares - expected on Friday - Rainbow will have 216.3 million shares outstanding.