Fairhills LBSR Agreement
Financing Agreement with Fairhills Capital Offshore Ltd.
On January 19, 2012, we entered into a financing agreement (the "Fairhills Agreement") with Fairhills Capital Offshore Ltd. ("Fairhills Capital"), whereby Fairhills Capital will provide for a non-brokered financing arrangement of up to $10,000,000. The financing allows but does not require us to issue and sell up to the number of shares of common stock having an aggregate purchase price of $10,000,000 to Fairhills Capital. On May 1, 2012, we entered into an amendment to the Investment Agreement (the "Amendment"). Pursuant to the Amendment, the Investment Agreement will only expire upon any of the following events: (i) when the Investor has purchased an aggregate of Ten Million dollars ($10,000,000) in the Common Stock of the Company pursuant to the Investment Agreement; or (ii) on the date which is thirty-six (36) months after the effective date of the Investment Agreement; or (iii) at such time that the Registration Statement registering the shares of common stock contemplated by the Investment Agreement is no longer in effect. In addition, the Company may terminate the Investment Agreement upon thirty (30) days written notice. Subject to the terms and conditions of the Fairhills Agreement and a registration rights agreement entered into concurrently (the "Registration Rights Agreement"), we may, in our sole discretion, deliver a notice to Fairhills Capital which states the dollar amount which we intend to sell to Fairhills Capital on a certain date. The amount that we shall be entitled to sell to Fairhills Capital shall be equal to two hundred percent (200%) of the average daily volume (U.S. market only) of our shares of common stock for the ten (10) trading days prior to the applicable notice date. Such shares of common stock will be valued at a 27.5% discount from the weighted average trading price of our stock for the five (5) trading days before Fairhills Capital receives our notice of sale. The shares of common stock that we sell to Fairhills Capital must be registered stock, among other conditions of investment.
Pursuant to the Registration Rights Agreement, we agreed to file a registration statement on Form S-1 with the Securities and Exchange Commission within twenty-one (21) days of the date of the Registration Rights Agreement and to have a registration statement declared effective by the Securities and Exchange Commission within one hundred and twenty (120) calendar days from January 19, 2012. A registration statement was filed on March 13, 2012. On June 1, 2012 our company requested withdrawal of the registration statement after receipt of a specific comment from the Securities and Exchange Commission advising that withdrawal of the registration statement was appropriate. On June 4, 2012 our company filed a new registration statement. The registration statement has not been declared effective yet.
Lbsr can sell 200% of 10 day trading volumes at 10 day average price at .275% discount 2 million shares @ .015 30 K & I believe there was also a Limit on the total Number of shares to be sold to them...... Please facts only in replies
Sageman
