Canada Rare Earth Corporation

Canada Rare Earth Exchanges Shares and a Lease for a US$1,200,000 Promissory Note

December 8, 2015

VANCOUVER, BRITISH COLUMBIA - Canada Rare Earth Corp. ("Canada Rare Earth" or the "Company") (TSX.V: LL) is pleased to announce that the Company has agreed to receive a promissory note due on November 30, 2018 in the amount of US$1,200,000 (approximately C$1,600,000 at the current exchange rates) in exchange for its equity investment in a privately held company with property in the West Indies and the related 25 year lease and option to extend the lease for 25 years for an additional US$1,000,000 due at the time of exercising the option.  The promissory note bears interest at 2% per annum for the first two years and 6% per annum for the third year.

The lease and option pertain to 15 acres of land situated on a 75 acre prospective gold property (the “Property”).

In the event the promissory note is not paid out in three years then Canada Rare Earth may reverse the transaction and extend the original lease period by the period of time that the promissory note was outstanding. The original cost of the investment and lease/option was US$1,100,000 (C$1,141,720 at the exchange rate then in effect).

Tracy A. Moore, Chief Executive Officer of Canada Rare Earth explained, “There are a number of parties interested in the Property and our lease and possible refinery complicate the financing and logistics of a third party developing the Property for the gold potential. Our core business is establishing an integrated rare earth business to supply top global customers with rare earths from sources situated outside of China. Our strategy does not focus on gold mining or exploration so we are willing to make the exchange. The promissory note proceeds, once collected, will provide additional financial resources for our rare earth initiatives in line with our corporate strategy. We continue to consider the West Indies as a suitable location for a rare earth processing facility and, in this regard, we are considering two other sites in the region.”

ABOUT CANADA RARE EARTH CORP.

Canada Rare Earth Corp. is developing an international integrated business within the global rare earth industry. Our key focus is to generate revenues and positive cash flow from a variety of profit centers in the rare earth production and sales chain by sourcing, adding value and selling rare earths in all stages and forms. We are in the process of establishing our own mining, concentrating and refinery capabilities in addition to working with affiliated and third party organizations.

ON BEHALF OF THE BOARD OF DIRECTORS OF CANADA RARE EARTH CORP:

Tracy A. Moore, CEO & President

"Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release." The information contained herein contains "forward-looking statements" within the meaning of applicable securities legislation. Forward-looking statements relate to information that is based on assumptions of management, forecasts of future results, and estimates of amounts not yet determinable. Any statements that express predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance are not statements of historical fact and may be "forward-looking statements."  Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements. Investors are cautioned against attributing undue certainty to forward-looking statements.  These forward looking statements are made as of the date hereof and the Company does not assume any obligation to update or revise them to reflect new events or circumstances.  Actual events or results could differ materially from the Company's expectations or projections.

For more information on the Company, interested parties should review the Company's filings that are available at www.sedar.com. 

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