Public Offering, Contemporaneous Private
Placement, Bond Issue and SoftBank Private Placement Escrow Release
complete comprehensive package that attracted investors from around
the world
Nemaska Lithium Inc. (“
Nemaska
Lithium” or
the “
Corporation”) (TSX:NMX) (OTCQX:NMKEF)
(FRANKFURT:N0T) is proud to announce that it has completed its
overall CAD 1.1B (USD 849M) financing package (the “
Project
Financing Package”) with the closing today of i) a
CAD 280M public offering of common shares on a
bought deal basis (the “
Public Offering”), ii) a
CAD 80M concurrent private placement of common
shares with Ressources Québec Inc., acting as mandatory for the
government of Québec (“Ressources Québec”) (the
“
Contemporaneous Private Placement”), iii) a
USD 350M offering of senior secured callable
bonds ("
Bonds") (the
"Bond
Offering") and iv) the release from escrow of
CAD
93.8M (USD 72.1M) from the previously closed private
placement with SoftBank Group Corp. (“
SoftBank”)
(the “
SoftBank Private Placement”).
“In the past 12 months, we have developed and
delivered a comprehensive Project Financing Package that we believe
will allow Nemaska Lithium to realize its long-term potential while
ensuring sufficient reserves for its future development”, said Guy
Bourassa, President and CEO of Nemaska Lithium. “With the financial
resources in hand, we will build a unique lithium hydroxide and
carbonate production facility, in tandem with a spodumene mine, all
within the province of Québec. To be vertically integrated, from
the mine to the end product, will give Nemaska a cost advantage
over industry peers. Today’s lithium ion batteries evolving
chemistry demands more and more lithium hydroxide, validating our
decision to focus on this growth segment within the lithium
market.”
Project Financing Package
Public Offering
The Public Offering was completed on a bought
deal basis pursuant to a prospectus supplement dated May 23, 2018
to the final base shelf prospectus dated March 29, 2018 (the
“Prospectus”) through a syndicate of underwriters
led by National Bank Financial Inc., BMO Capital Markets and Cantor
Fitzgerald Canada Corporation as joint bookrunners, and including
CIBC World Markets Inc., Echelon Wealth Partners Inc., Eight
Capital, Canaccord Genuity Corp., Cormark Securities Inc., Jett
Capital Advisors, LLC, Industrial Alliance Securities Inc. and
Laurentian Bank Securities Inc. Clarksons Platou Securities AS
acted as a selling agent in the Public Offering.
Pursuant to the Public Offering, the Corporation
issued 280,000,000 common shares (the “Offered
Shares”) at a price of CAD 1.00 per Offered Share (the
“Offering Price”), for aggregate gross proceeds of
CAD 280M.
For further terms and details of the Public
Offering, please refer to the Corporation’s press release dated
May 22, 2018 and the Prospectus which is filed under the
Corporation’s profile on SEDAR at www.sedar.com.
Contemporaneous Private Placement
Contemporaneously with the Public Offering, the
Corporation completed the Contemporaneous Private Placement with
Ressources Québec, pursuant to which the Corporation has issued
80,000,000 common shares (“Private Placement
Shares”) at the Offering Price for aggregate gross
proceeds of CAD 80M. The Private Placement Shares will
be subject to a restriction on resale of four months and one day
from the date hereof.
Bond Offering
The Bond Offering was completed on a private
placement basis through Clarksons Platou Securities and Pareto
Securities, as joint lead managers.
The Bonds issued in the aggregate principal
amount of USD 350M (approximately CAD 455M) are USD-denominated
with a maturity date of May 30, 2023, unless called by the
Corporation prior to maturity, and bear interest at a rate of
11.25% per annum. Interest is payable quarterly and in
arrears on the relevant interest payment date in February, May,
August and November of each year, commencing on August 30,
2018.
An amount equal to the gross proceeds of the
Bond Offering together with the 3 month interest payment obligation
(the “Bond Funds”) has been placed into a USD
escrow account (the “Trust Account”) pending the
satisfaction of certain conditions precedent by the Corporation on
or prior to August 30, 2018 (the “Long Stop
Date”). The Trust Account has been pledged in favour
of the Bondholders. The Bonds will be reimbursed, with
accrued interest, from the Bond Funds in the event that the
Corporation has not, prior to the Long Stop Date, met the requisite
conditions precedent. Such conditions precedent to the Long
Stop Date include but are not limited to, the first tranche under
the Streaming Agreement (as defined below) being released, the
Corporation having obtained various material project documents, the
inter-creditor agreement with Orion (as defined below) having been
entered into and the security package over all assets to be charged
in connection with the Bond Offering having been executed and
rendered opposable to third parties.
Following the Long Stop Date, additional
conditions precedent are required to be met by the Corporation in
order to permit the drawdown of Bond Funds from the Trust
Account.
For additional details regarding the various
conditions precedent, the terms and details of the Bonds and the
Bond Offering, please refer to the Corporation’s press release
dated May 10, 2018. The full text of the Bonds Terms will be
available on the Corporation’s profile on SEDAR at
www.sedar.com following the date hereof. Readers are
encouraged to refer to the full text of the Bond Terms for all of
the terms and conditions of the Bonds.
The Corporation intends to apply to list the
Bonds on the Nordic Alternative Bond Market (ABM).
SoftBank Private Placement Escrow Release
On April 25, 2018, the Corporation announced the
closing of a subscription receipt private placement with SoftBank
pursuant to which a total of 88,460,446 subscription receipts were
issued at a price of CAD 1.12 per subscription receipt for gross
proceeds of CAD 99.075M which were placed into escrow pending the
satisfaction of certain escrow release conditions.
The Corporation is pleased to announce that all
escrow release conditions have now been met following the
completion of the Public Offering, the Contemporaneous Private
Placement and the Bond Offering and, as a result, 83,729,011
subscription receipts have been converted and an equal number of
common shares, representing 9.9% of the issued and outstanding
common shares of the Corporation following completion of the Public
Offering, the Contemporaneous Private Placement and the issuance of
common shares pursuant to the SoftBank Private Placement, have been
deemed to be issued to SoftBank for gross proceeds of CAD 93.8M
(USD 72.1M) released from escrow to the Corporation.
A Unique and Unprecedented Financing
Structure in the Lithium Industry
This announcement marks an important stage of
the comprehensive Project Financing Package that will fund the
construction, commissioning, working capital and reserve funds for
the Whabouchi lithium mine and the Shawinigan electrochemical plant
(collectively, the “Project”), as well as general
working capital.
The closings today of these four elements of the
Project Financing Package coupled with the USD 150M (CAD 195M)
streaming agreement with Orion Mine Finance II LP
(“Orion”) (the “Streaming
Agreement”), as announced on April 12, 2018
allow Nemaska Lithium to deliver a CAD 1.1B (USD 849M) equivalent
project financing to finance the development of the Project. In
consideration of the Streaming Agreement, Orion will make an
advance payment equal to USD 150M to Nemaska Lithium Shawinigan
Transformation Inc., a wholly-owned subsidiary of Nemaska Lithium.
The advance payment will be released in two equal tranches of USD
75M with the first tranche expected to be payable once Nemaska
Lithium has satisfied certain customary conditions at the latest on
December 31, 2018. The second tranche will be payable upon the
satisfaction of certain technical and other customary conditions
that must be satisfied no later than December 31, 2019.
Onwards to Construction
The construction and commissioning of the
Whabouchi mine site is expected to be completed within 15 months,
while approximately 24 months is expected to be required for the
Shawinigan electrochemical plant. A total of up to 1,000 workers
will be welcomed to the construction sites over that time.
About Nemaska Lithium
Nemaska Lithium is a developing chemical company
whose activities will be vertically integrated, from spodumene
mining to the commercialization of high-purity lithium hydroxide
and lithium carbonate. These lithium salts are mainly destined for
the fast-growing lithium-ion battery market, which is driven by the
increasing demand for electric vehicles and energy storage
worldwide. With its products and processes, Nemaska Lithium intends
to facilitate access to green energy.
The Corporation will be operating the Whabouchi
mine in Québec, Canada, one of the richest lithium spodumene
deposits in the world, both in volume and grade. The spodumene
concentrate produced at the Whabouchi mine will be processed at the
Shawinigan plant using a unique membrane electrolysis process for
which the Corporation holds several patents.
Nemaska Lithium is a member of the S&P/TSX
SmallCap Index, S&P/TSX Global Mining Index, S&P/TSX Global
Base Metals Index, S&P/TSX Equal Weight Global Base Metals
Index, and the MSCI Canada Small Cap Index. For more information,
visit nemaskalithium.com or twitter.com/Nemaska_Lithium.
Important notice
The information contained in this announcement
is for background purposes only and does not purport to be full or
complete. The announcement does not constitute an offer to sell or
the solicitation of an offer to buy securities in any jurisdiction.
The publication, distribution or release of this announcement may
be restricted by law in certain jurisdictions and persons into
whose possession any document or other information referred to
herein comes should inform themselves about and observe any such
restriction. Any failure to comply with such restrictions may
constitute a violation of the securities laws of any such
jurisdiction.
This press release is not an offer or a
solicitation of an offer of securities for sale in the United
States. The securities offered and sold pursuant to the Public
Offering, the Contemporaneous Private Placement, the Bond Offering
and the SoftBank Private Placement have not been, and will not be,
registered under the U.S. Securities Act of 1933, as amended (the
“U.S. Securities Act”), or any U.S. state
securities laws, and may not be offered or sold in the United
States or to, or for the account or benefit of, U.S. persons (as
defined under the U.S. Securities Act) absent registration or any
applicable exemption from the registration requirements of the U.S.
Securities Act and applicable U.S. state securities laws.
This news release shall not constitute an offer to sell or the
solicitation of an offer to buy securities in the United States,
nor shall there be any sale of these securities in any jurisdiction
in which such offer, solicitation or sale would be unlawful. The
Corporation does not intend to register any securities referred to
herein in the United States or to conduct a public offering of
securities in the United States.
Cautionary Statement on Forward-Looking
Information
All statements, other than statements of
historical fact, contained in this press release including, but not
limited to, those relating to the Corporations’ long-term
potential, its cost advantage and its reserves, the development,
construction and commissioning of the Project, constitute
“forward-looking information” and “forward-looking statements”
within the meaning of certain securities laws and are based on
expectations and projections as of the date of this press release.
Certain important assumptions by the Corporation in making
forward-looking statements include, but are not limited to, (a) the
satisfaction, in a timely manner, by the Corporation of conditions
precedent to the Long Stop Date and to the release of the gross
proceeds of the Bond Offering, (b) the satisfaction, in a timely
manner, by the Corporation of conditions precedent to the receipt
of payments from Orion under the Streaming Agreement, and (c) the
Corporation being able to bring the Whabouchi mine and the
Shawinigan plant to commercial production.
Forward-looking statements contained in this
press release including, without limitation, those related to (i)
the intended use of proceeds of the Project Financing Package,
(ii) the release of proceeds to the Corporation from the Bond
Offering, (iii) the application for the Bonds’ listing on the
Nordic ABM, (iv) the payments to be received under the Streaming
Agreement, (v) the estimated timelines for the construction and
commissioning at the Project, and (vi) generally, the above “About
Nemaska Lithium” paragraph which essentially describes 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. 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
can directly or indirectly affect, and could cause, actual results
to differ materially from those expressed or implied in any
forward-looking statements and future events, could differ
materially from those anticipated in such statements.
By their very nature, forward-looking statements
involve inherent risks and uncertainties, both general and
specific, and risks exist that estimates, forecasts, projections
and other forward-looking statements will not be achieved or that
assumptions do not reflect future experience. Forward-looking
statements are provided for the purpose of providing information
about management's endeavors to develop the Project and, more
generally, its expectations and plans relating to the future.
Readers are cautioned not to place undue reliance on these
forward-looking statements as a number of important risk factors
and future events could cause the actual outcomes to differ
materially from the beliefs, plans, objectives, expectations,
anticipations, estimates, assumptions and intentions expressed in
such forward-looking statements. All of the forward-looking
statements made in this press release are qualified by these
cautionary statements and those made in our other filings with the
securities regulators of Canada including, but not limited to, the
cautionary statements made in the “Risk Factors” section of the
Corporation’s Annual Information Form dated October 5, 2017 and the
“Risk Exposure and Management” section of the Corporation’s
quarterly Management Discussion & Analysis. 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.
Further information regarding Nemaska Lithium is
available in the SEDAR database (www.sedar.com) and on the
Corporation's website at: www.nemaskalithium.com.
FOR FURTHER INFORMATION, PLEASE
CONTACT:
Victor
CantoreInvestor
Relations514 831-3809victor.cantore@nemaskalithium.com |
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Fanny-Ève TappMedia Relations514 442-0445
fanny-eve.tapp@nemaskalithium.com |
Wanda
Cutler Investor Relations 416 303-6460
wanda.cutler@nemaskalithium.com |
www.nemaskalithium.com