Canada Lithium Corp. (TSX: CLQ) (U.S. OTC: CLQMF) today announced that it has entered into an agreement with Dundee Securities Ltd. on behalf of a syndicate of underwriters including Primary Capital Inc. as co-lead underwriter and Jones, Gable & Company Limited, on a bought-deal basis, for a private placement of 21,110 convertible unsecured subordinated debentures of the Company which will be issued at par at a price of C$1,000 per Debenture for gross proceeds to the Company of C$21,110,000. The Company intends to use the net proceeds from the Offering for working capital and general corporate purposes.
The Debentures will mature on June 30, 2018 and pay a coupon of 11.0% per annum from the closing date, payable semi-annually on the last day of June and December of each year commencing on June 30, 2013. The first interest payment will be made on June 30, 2013 and will consist of interest accrued from and including the Closing Date to June 30, 2013.
The Debentures will be convertible at the holder’s option into common shares of the Issuer at any time prior to the close of business on the earlier of the Maturity Date and the business day immediately preceding the date fixed for redemption of the Debentures. The Common Shares will convert at a conversion price of $0.72 per Common Share, being a ratio of 1,388.89 Common Shares per C$1,000 principal amount of Debentures, subject to adjustment in certain events including dividend protection for the declaration of dividends. Holders converting their Debentures will receive accrued and unpaid interest thereon, up to, but excluding, the date of conversion. The conversion rate may be adjusted upon the occurrence of certain events, pursuant to standard anti-dilution provisions as will be set out in the indenture governing the Debentures.
The Debentures will not be redeemable before June 30, 2016. On and after the First Call Date and prior to the Maturity Date, the Issuer may, at its option, at any time and from time to time, subject to providing not more than 60 and not less than 30 days’ prior notice, redeem the Debentures, in whole or in part, at par plus accrued and unpaid interest provided that the weighted average closing price of the Common Shares on the Toronto Stock Exchange during the 20 consecutive trading days ending five trading days preceding the date on which the notice of redemption is given is not less than 130% of the Conversion Price.
The Debentures will rank subordinate in right of payment of principal and interest to all senior obligations of the Issuer.
In connection with the Offering, the Underwriters will receive an aggregate cash commission equal to 5% of the gross proceeds raised under the Offering. The Closing Date of the Offering is anticipated to occur on or about May 15, 2013 and is subject to the receipt of applicable regulatory approvals including approval of the Toronto Stock Exchange.
All securities issued in connection with the Offering will be subject to a four months plus one day hold period from the Closing Date, pursuant to Canadian securities laws. The Offering will be conducted on a private placement basis pursuant to exemptions from the prospectus requirements of applicable securities laws in one or more provinces of Canada. The securities mentioned herein have not been and will not be qualified by prospectus for sale to the public under applicable Canadian securities laws. The securities mentioned herein will be subject to transfer and selling restrictions in certain jurisdictions, including the United States and Canada.
About Canada Lithium Corp.
The Company holds a 100% interest in the Québec Lithium Project near Val d’Or, the geographical heart of the Québec mining industry. It has completed construction and is in the commissioning phase of an open-pit mine and on-site processing plant with estimated capacity to produce approximately 20,000 tonnes of battery-grade lithium carbonate annually. Metallurgical tests have produced battery-grade lithium carbonate samples. A five-year off-take agreement for a minimum of 12,000 tonnes per year was recently signed with Tewoo-ERDC, one of China’s largest commodities traders. A second off-take for up to 5,000 tonnes per year was recently signed with Marubeni Corp., a major Japanese commodities trading company. Lithium carbonate is used in lithium-ion batteries that power consumer electronics (laptops, tablets, etc.), power-grid storage facilities and electric and hybrid vehicles.
Maverix Metals Inc. (NYSE American: MMX) (TSX: MMX) is pleased to... READ MORE
Brixton Metals Corporation (TSX-V: BBB) (OTCQB: BBBXF) is pleased... READ MORE
Osisko Gold Royalties Ltd (TSX:OR) (NYSE:OR) announces today that... READ MORE
Balmoral Resources Ltd. (TSX: BAR) (OTCQX: BALMF) announces that ... READ MORE
RNC Minerals (TSX: RNX) (RNC) is pleased to announce results of t... READ MORE