Nemaska Lithium Completes Its CAD 1.1 Billion Financing Package
Public Offering, Contemporaneous Private Placement, Bond Issue and SoftBank Private Placement Escrow Release complete comprehensive package that attracted investors from around the world
Proceeds will finance the construction and commissioning of commercial facilities both at the Whabouchi mine and the Shawinigan electrochemical plant
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QUEBEC CITY, May 30, 2018 (GLOBE NEWSWIRE) -- 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
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.
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.