Nemaska Lithium Announces Bought Deal Public Offering of Common Shares and Provides Project Update
June 12, 2017 (Source) – NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Nemaska Lithium Inc. (TSX:NMX)(OTCQX:NMKEF) (“Nemaska Lithium” or the “Corporation“) is pleased to announce that it has entered into an agreement with a syndicate of underwriters led by National Bank Financial Inc. (together the “Underwriters”), under which the Underwriters have agreed to purchase on a bought deal basis 47,620,000 common shares of the Corporation (the “Shares“) at a price of $1.05 per Share for gross proceeds of $50mm (the “Offering“). The Shares will be offered in all provinces and territories of Canada pursuant to a short form prospectus to be filed by Nemaska Lithium, as well as in the United States under applicable registration statement exemptions and such other jurisdictions as may be agreed to by Nemaska Lithium on a private placement basis.
The Corporation has also granted the Underwriters an over-allotment option to purchase up to that number of additional Shares equal to 15% of the Shares purchased pursuant to the Offering, exercisable in whole or in part at any time up to 30 days after and including the closing date of the Offering.
The Corporation intends to use the net proceeds of the Offering for ongoing development of the Whabouchi lithium mine, the Whabouchi spodumene concentrator and the Shawinigan hydrometallurgical plant (collectively, the “Lithium Project“), including for ongoing engineering work, infrastructure construction, down-payments for the order of long lead items and general working capital purposes.
The Offering is expected to close on or about June 29, 2017, and is subject to the receipt of all necessary regulatory approvals, including, but not limited to, the approval of the Toronto Stock Exchange and subject to certain other conditions.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States. The Shares have not been and will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States or to a U.S. person absent registration or an applicable exemption from such registration requirements.
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Update on the Lithium Project Debt Financing
Nemaska Lithium also reports that it has been actively engaged in discussions with prospective lenders regarding terms and conditions of the project debt financing to fund the Lithium Project (the “Project Debt Financing“), and has recently begun the due diligence phase of the process with certain parties. The Corporation is confident to enter into an agreement with the lenders by the end of Q3, 2017.
Update on Ongoing Discussions with Ressources Québec
The Government of Québec, Nemaska Lithium’s largest shareholder through Ressources Québec’s holding of 29.4 million shares, remains highly supportive of Nemaska Lithium and the Lithium Project. Nemaska Lithium and Ressources Québec remain in ongoing discussions regarding a potential future capital investment in the Corporation to further support the realization of the project. To date, no agreement has been reached between the parties and Nemaska Lithium will continue to evaluate its financing alternatives with a view of maximizing shareholder value.
Update on Overall Project Progress
Guy Bourassa, president & CEO of Nemaska Lithium, commented on these recent announcements: “The Offering will put Nemaska Lithium on strong financial footing to continue development work associated with the Lithium Project. This financing will allow Nemaska Lithium to make further progress in building the required facilities at the Whabouchi site and the commercial hydrometallurgical plant at the Shawinigan site, which will allow Nemaska Lithium to stay on target to initiate commercial-scale production by Q1 2019. Eventually, as Nemaska Lithium becomes an emerging low-cost producer in the global lithium marketplace, it will be ideally positioned to capitalize on the advantageous lithium market demand dynamics that we expect in the near and medium term.”
“We are also encouraged by the ongoing discussions regarding the Project Debt Financing. These developments, coupled with the ongoing support received from Ressources Québec and other key shareholders, have reiterated what management and the Board have known all along – that Nemaska Lithium is poised to become a leading player in the global lithium market.”
About Nemaska Lithium
Nemaska Lithium intends to become a lithium hydroxide and lithium carbonate supplier to the emerging lithium battery market that is largely driven by electric vehicles, cell phones, tablets and other consumer products. The Corporation is developing in Québec one of the most important spodumene lithium hard rock deposit in the world, both in volume and grade. The spodumene concentrate produced at Nemaska Lithium’s Whabouchi mine will be shipped to the Corporation’s lithium compounds processing plant to be completed in Shawinigan, Québec. This plant will transform spodumene concentrate into high purity lithium hydroxide and carbonate using the proprietary methods developed by the Corporation, and for which the Corporation holds seven granted patents and several patent applications that are pending in different countries, covering different aspects and improvements of its proprietary technology for preparing high purity lithium hydroxide and carbonate.
All statements, other than statements of historical fact, contained in this press release including, but not limited to statements regarding, (i) the completion and use of proceeds of the Offering (and of the possible exercise of the over-allotment option), (ii) the expected closing of the Offering on or about June 29, 2017, (iii) the Corporation being confident to enter into an agreement with lenders by the end of Q3, 2017, (iv) a potential future capital investment by Ressources Québec and the Corporation’s continuous evaluation of financing alternatives to maximize shareholder value, (v) the Corporation being put on strong financial footing as a result of this Offering, (vi) this financing to enable the Corporation to continue building the required facilities, and to stay on target to initiate commercial-scale production by the end of Q1 2019, (vii) the Corporation becoming an emerging low-cost producer in the global lithium marketplace, ideally positioned to capitalize on the advantageous near and medium term lithium market demand dynamics contemplated by the Corporation, (viii) the Corporation being poised to become a leading player in the global lithium market, and (ix) generally, the above “About Nemaska Lithium” paragraph which essentially describe the Corporation’s outlook constitute ”forward-looking information” or ”forward-looking statements” within the meaning of certain securities laws, and are based on expectations, estimates and projections as of the time of this press release, including that all necessary regulatory approvals and other conditions to complete the Offering will be obtained or satisfied and that ongoing discussions with lenders and Ressources Québec may lead to the Project Debt Financing and a capital investment, respectively. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Corporation as of the time of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. These estimates and assumptions may prove to be incorrect.
Many of these uncertainties and contingencies, including the fact that there is no certainty that closing of the Offering will occur at all or that the Corporation will secure the financing for an amount sufficient to fund all of its required construction and commissioning costs, can directly or indirectly affect, and could cause, actual results to differ materially from those expressed or implied in any forward-looking statements. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management’s expectations and plans relating to the future. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law.
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