Liberty Star & Metals Corp. (OTCQB:LBSR) has entered into a material definitive agreement with GHS Investments, LLC, securing an investment of up to $10 million for the sale of its common stock. This strategic move is designed to provide the company with additional capital to fund its operations and exploration activities.
Under the terms of the agreement, Liberty Star has the discretion to issue put notices to the investor, specifying the amount of common stock it plans to sell. The sale amounts are tied to 200% of the average daily trading volume of Liberty Star's common stock on U.S. markets for the ten days preceding the notice, with a maximum of $500,000 every ten days and a minimum threshold of $10,000.
In conjunction with this investment agreement, Liberty Star has also committed to a registration rights agreement. This obligates the company to file a Registration Statement on Form S-1 with the SEC within 30 days following the agreement and to have the statement declared effective within 90 days after filing.
The investment, facilitated by GHS Investments, represents a significant financial infusion for Liberty Star, potentially strengthening its financial position and enabling it to advance its mineral exploration projects.
In other recent news, Liberty Star Uranium & Metals Corp. has secured additional financial support for its operations through various agreements and loans, while also reporting high-grade gold discovery at its Red Rock Canyon Gold Project in Arizona.
Overall, Liberty Star's recent $10 million investment agreement signifies a crucial development for the company, as reflected in the latest financial data. While the company has shown positive momentum in its market performance, challenges remain in terms of weak gross profit margins and profitability. The secured investment is essential for funding ongoing operations and exploration activities, highlighting the importance of this capital infusion for Liberty Star's future prospects.