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Nemaska Lithium (TSXV:NMX) announced that it has applied to extend the term and increase the exercise price of certain share purchase warrants. This would apply to warrants exercised after their initial expiry date.
Nemaska Lithium (TSXV:NMX) announced that it has applied to extend the term and increase the exercise price of certain share purchase warrants. This would apply to warrants exercised after their initial expiry date.
As quoted in the press release:
An aggregate of 10,416,666 share purchase warrants (the “Supplement no2 Warrants”) were issued on October 28, 2013, November 8, 2013 and November 14, 2013 pursuant to the Corporation’s prospectus supplement no2 dated October 16, 2013, to the short form base shelf prospectus dated March 4, 2013 (the “Short Form Prospectus”), each of which initially entitled the warrant holder to purchase one common share in the capital of the Corporation at a price of $0.18 until October 28, 2015. An aggregate of 14,950,000 share purchase warrants (the “Supplement no3 Warrants”) were issued on April 12, 2014 pursuant to the prospectus supplement no3 dated March 13, 2014 to the Short Form Prospectus, each of which initially entitled the warrant holder to purchase one common share in the capital of the Corporation at a price of $0.20 until October 2, 2015. An aggregate of 4,536,765 share purchase warrants (the “Supplement no4 Warrants”) were issued on November 13, 2014 and November 17, 2014 pursuant to the amended prospectus supplement no4 dated November 5, 2014 to the Short Form Prospectus, each of which initially entitled the warrant holder to purchase one common share in the capital of the Corporation at a price of $0.25 until November 16, 2015.
The board of directors of the Corporation has approved the amendment to the Supplement no2 Warrants, the Supplement no3 Warrants and Supplement no4 Warrants (collectively the “Warrants”) to extend their expiry date to April 21, 2017. The exercise price of the Warrants will also be increased by $0.02 if they are exercised after their initial expiry dates. The exercise price of the Supplement no2 Warrants, Supplement no3 Warrants and Supplement no4 Warrants will be respectively set at $0.20, $0.22 and $0.27 if exercised after October 28, October 2 and November 16, 2015. The Amendment to the Warrants is subject to the approval of the TSXV.
In certain cases, the Amendment to the Warrants constitutes a “related party transaction” within the meaning of Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions (“Regulation 61-101”) and TSX Venture Exchange Policy 5.9 – Protection of Minority Security Holders in Special Transactions as an aggregate of 1,480,000 Supplement no2 Warrants (14.20%) and an aggregate of 1,857,500 Supplement no3 Warrants (12.42%) are held by directors of the Corporation. However, the directors of the Corporation who voted in favour of the Amendment to the Warrants have determined that the exemptions from formal valuation and minority approval requirements provided for respectively under subsections 5.5(a) and 5.7(1)(a) of Regulation 61-101 can be relied on as neither the fair market value of the Supplement no2 Warrants and the Supplement no3 Warrants nor the fair market value of the consideration paid for such Supplement no2 and the Supplement no3 Warrants exceeds 25% of the Corporation’s market capitalization. None of the Corporation’s directors has expressed any contrary views or disagreements with respect to the foregoing.
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