Euro Manganese Inc. (TSX-V:EMN) (ASX: EMN) is pleased to announce that, following the approval by its shareholders at a special meeting held on December 10, 2020, it has closed the second tranche of the private placement announced on October 21, 2020.
The Tranche 2 Placement was comprised of 1,216,862 common shares and 26,883,138 CHESS Depositary Interests at a price of C$0.19 per Share and A$0.20 per CDI, respectively, for aggregate gross proceeds of C$5,339,000 (A$ 5,620,000). The Tranche 2 Placement consisted of (i) subscriptions for 1,022,230 Shares and 26,883,138 CDIs issued in excess of the number of securities permitted to be issued by the Company without obtaining prior shareholder approval under Listing Rule 7.1 of the Australian Securities Exchange, such subscriptions being subject to approval by the Company’s shareholders pursuant to Listing Rule 7.1; and (ii) subscriptions by related parties of the Company (consisting of a director of the Company and a company controlled by a director of the Company) for 194,632 Shares, such subscriptions being subject to approval by the Company’s shareholders pursuant to Listing Rule 10.11.1. Shares issued pursuant to the Tranche 2 Placement are subject to a four-month statutory hold period expiring on April 17, 2021.
Aggregate gross proceeds under the Offering were approximately C$11.4 million (A$12.0 million). Net proceeds of the Offering will be used by the Company to further progress its Chvaletice Manganese Project in the Czech Republic, including placing the order on the Chvaletice Demonstration Plant, advancing the Project’s permitting, advancing work on the feasibility study and for other general corporate purposes. Canaccord Genuity (Australia) Limited acted as Lead Manager and Bookrunner for the Offering, with Bacchus Capital Advisers Limited acting as financial adviser to the Company. Fees payable in cash by the Company in connection with the Offering consisted of payments of A$571,568 (approximately C$543,000) to Canaccord and C$127,645 to BCAL. Additionally, the Company issued 6,000,000 broker warrants to Canaccord. The Broker Warrants are exercisable any time prior to December 16, 2023, with one-half of such Broker Warrants having an exercise price of C$0.30 per Share and one-half of such Broker Warrants having an exercise price of C$0.35 per Share.
The Shares and CDIs issued under the Offering have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States or to U.S. Persons absent registration or an applicable exemption from registration. This press release is not an offer or a solicitation of an offer of securities for sale in the United States, nor will there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
The issuance of Shares to insiders of the Company pursuant to the Tranche 2 Placement is considered to be related party transactions under Canada’s Multilateral Instrument 61-101. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements provided under sections 5.5(a) and 5.7(1)(a) of MI 61-101 on the basis that participation in the Tranche 2 Placement by insiders does not exceed 25% of the fair market value of the Company’s market capitalization.
About Euro Manganese:
Euro Manganese Inc. is a Canadian waste recycling company, whose principal focus is advancing the evaluation and development of the Chvaletice Manganese Project, in which it holds a 100% interest. The proposed Project entails re-processing a significant manganese deposit hosted in historic mine tailings, strategically located in the Czech Republic. EMN’s goal is to become a leading, competitive and environmentally superior primary producer of Ultra-High-Purity Manganese Products in the heart of Europe, serving both the lithium-ion battery industry, as well as producers of specialty steel and aluminum alloys.
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We acknowledge the [financial] support of the Government of Canada.