CENTENNIAL, Colo. ,
March 17,
2023 /PRNewswire/ -- NioCorp Developments Ltd.
("NioCorp" or the "Company") (TSX: NB; OTCQX:
NIOBF) today announced the completion of its previously
announced business combination (the "Business Combination")
with GX Acquisition Corp. II ("GXII"). Further, NioCorp also
announced the closing of both tranches of its previously announced
convertible debt financing (the "Yorkville Convertible Debt
Financing") with YA II PN, Ltd., an investment fund managed by
Yorkville Advisors Global, LP (together with YA II PN, Ltd.,
"Yorkville"), and the effectiveness of its previously
announced standby equity purchase facility with Yorkville (the
"Yorkville Equity Facility Financing", and together with the
Business Combination and the Yorkville Convertible Debt Financing,
the "Transactions").
Pursuant to the Business Combination, a wholly owned, U.S.-based
subsidiary of NioCorp merged with and into GXII, with GXII
surviving the merger as a subsidiary of NioCorp. In connection with
the merger, GXII changed its name to "Elk Creek Resources Corp." As
the parent company of the merged entity, NioCorp issued 1,753,823
common shares (the "Common Shares") in exchange for all of
the Class A shares of GXII issued and outstanding immediately prior
to the Business Combination. The Class B shares of GXII issued and
outstanding immediately prior to the Business Combination (after
giving effect to the surrender of certain Class B shares of GXII in
accordance with the support agreement, dated September 25, 2022, among GX Sponsor II LLC,
GXII, NioCorp and the other persons party thereto) were converted
into Class B shares of GXII (now known as Elk Creek Resources
Corp.) as the surviving entity of the merger and became
exchangeable into Common Shares on a one-for-one basis, a portion
of which are subject to vesting during the first ten years
following the Business Combination closing date based upon
achieving market share price milestones, and all of which are
subject to restrictions on transfer beginning upon the closing and
ending upon the earlier of (i) one year after the closing and (ii)
the date on which the trading price of the Common Shares exceeds
certain thresholds or the date on which NioCorp completes a
transaction that results in all of NioCorp's shareholders having
the right to exchange their Common Shares for cash, securities or
other property. In connection with the closing, NioCorp also
assumed the outstanding GXII share purchase warrants (the
"Assumed Warrants"), which will be exercisable for Common
Shares with an exercise price of approximately $10.28 per Common Share. The Assumed Warrants are
exercisable beginning on the 30th day after closing and will remain
exercisable until the 5th anniversary of the closing date. All
numbers in this press release give effect to the completed
Consolidation (as defined herein).
Pursuant to the Yorkville Convertible Debt Financing, Yorkville
advanced a total of US$15.36 million
to NioCorp in consideration of the issuance of US$16.0 million aggregate principal amount of
convertible debentures of NioCorp convertible into Common Shares of
NioCorp (the "Convertible Debentures"). Each Convertible
Debenture issued under the Yorkville Convertible Debt Financing is
an unsecured obligation of NioCorp, may be converted at a discount
to the market price as of the date of conversion, has an 18-month
term, which may be extended for one six-month period in certain
circumstances at the option of NioCorp, and incurs a simple
interest rate obligation of 5.0% per annum (which will increase to
15.0% per annum upon the occurrence of an event of default). In
conjunction with the issuance of the Convertible Debentures,
NioCorp issued to Yorkville 1,789,267 Common Share purchase
warrants entitling Yorkville to purchase Common Shares (the
"Financing Warrants") at an exercise price of approximately
$8.94 per Common Share. The Financing
Warrants are exercisable beginning on the earlier of (a) six months
from their issuance or (b) the effective date of the initial
registration statement registering the resale by Yorkville of the
Common Shares issuable upon the conversion of the Convertible
Debentures and the exercise of the Financing Warrants under the
U.S. Securities Act of 1933 (the "Exercise Date"), and may
be exercised at any time prior to their expiration. On each of the
first 12 monthly anniversaries of the Exercise Date, 1/12th of the
Financing Warrants will expire.
Pursuant to the Yorkville Equity Facility Financing, NioCorp
will have the right, but not the obligation, to sell Common Shares
to Yorkville with a maximum aggregate value of up to US$65.0 million (the "Commitment Amount")
for a period of up to 36 months at a discount to the market price
as of the date of each respective issuance, subject to certain
limitations and the satisfaction of certain conditions. Upon
closing, NioCorp paid US$0.5 million
to Yorkville as part of a cash fee, and will pay an additional
US$1.0 million in cash to Yorkville
in installments over the next 12-months. Further, within five days
of closing, NioCorp will issue to Yorkville 81,213 Common Shares as
consideration for Yorkville's irrevocable commitment to purchase
Common Shares under the Yorkville Equity Facility Financing.
In connection with closing, NioCorp received approximately
US$15.28 million in gross proceeds
from the Business Combination. Deal costs are anticipated to
be approximately US$20.3
million. NioCorp received an additional US$15.36 million in net proceeds from the
Yorkville Convertible Debt Financing. NioCorp also expects to have
access to up to an additional $61.6
million in net proceeds from the Yorkville Equity Facility
Financing over the next three years. After giving effect to the
Business Combination, the Yorkville Convertible Debt Financing and
the Yorkville Equity Facility Financing, NioCorp expects to have
access to a total of US$71.9 million
in net proceeds over the next three years.
NioCorp Board of Directors
Following completion of the Business Combination, Dean C. Kehler and Michael G. Maselli have been appointed to the
NioCorp board of directors, joining the seven existing NioCorp
board members. Mr. Kehler is a Managing Partner of Trimaran Capital
Partners, a manager of private investment funds, and
currently serves on the Boards of Directors of Celularity Inc., El
Pollo Loco Holdings, Inc. and Portman Ridge Finance Corporation.
Mr. Maselli is a Managing Director of Trimaran Capital Partners and
the Chairman of the Board of El Pollo Loco Holdings Inc.
Share Consolidation
The Company also effected a share consolidation (reverse stock
split) (the "Consolidation") of its issued and outstanding
Common Shares on the basis of one (1) post-Consolidation Common
Share for every ten (10) pre-Consolidation Common Shares. Following
completion of the Business Combination and the Consolidation, there
are currently 30,000,442 Common Shares issued and outstanding.
Further, there are 7,957,404 Class B shares of GXII (now known as
Elk Creek Resources Corp.), as the surviving entity of the merger,
that are exchangeable for an aggregate of up to
7,957,404 Common Shares and 15,666,667 Assumed Warrants
exercisable for an aggregate of up to 17,519,910 Common Shares. All
existing convertible securities of the Company have proportionally
adjusted as result of the Consolidation, in accordance with their
respective terms. The Convertible Debentures and the Financing
Warrants were issued following the Consolidation, but have similar
terms that provide for proportional adjustment thereof.
The Common Shares and the Assumed Warrants are expected to begin
trading on The Nasdaq Global Market and The Nasdaq Capital Market,
respectively, on March 21, 2023,
under the symbols "NB" and "NIOBW," respectively. The Common Shares
will continue to trade on the Toronto Stock Exchange ("TSX")
under the symbol "NB," and will continue to trade on a
pre-consolidated basis until such time as the TSX advises that
trading on a post-consolidated basis will commence, which is
expected to be at the beginning of regular trading hours on
March 21, 2023. The Common Shares
will cease being quoted on the OTC Markets in connection with the
commencement of trading on The Nasdaq Global Market.
For More Information
Contact Jim Sims, Corporate
Communications Officer, NioCorp Developments Ltd., (720) 334-7066,
jim.sims@niocorp.com
https://www.niocorp.com
About NioCorp
NioCorp is developing a critical minerals project in
Southeast Nebraska that will
produce niobium, scandium, and titanium. The Company also is
evaluating the potential to produce several rare earths from the
Project. Niobium is used to produce specialty alloys as well as
High Strength, Low Alloy ("HSLA") steel, which is a lighter,
stronger steel used in automotive, structural, and pipeline
applications. Scandium is a specialty metal that can be combined
with Aluminum to make alloys with increased strength and improved
corrosion resistance. Scandium is also a critical component of
advanced solid oxide fuel cells. Titanium is used in various
lightweight alloys and is a key component of pigments used in
paper, paint and plastics and is also used for aerospace
applications, armor, and medical implants. Magnetic rare earths,
such as neodymium, praseodymium, terbium, and dysprosium are
critical to the making of Neodymium-Iron-Boron ("NdFeB") magnets,
which are used across a wide variety of defense and civilian
applications.
Forward-Looking Statements
This communication contains forward-looking statements within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and forward-looking information within the
meaning of applicable Canadian securities laws. Forward-looking
statements may include, but are not limited to, the anticipated
benefits of the proposed Transactions, including the ability to
access the full amount of the expected net proceeds over the next
three years; the financial and business performance of NioCorp;
NioCorp's anticipated results and developments in the operations of
NioCorp in future periods; NioCorp's planned exploration
activities; the adequacy of NioCorp's financial resources;
NioCorp's ability to secure sufficient project financing to
complete construction and commence operation of the Elk Creek
Project; NioCorp's expectation and ability to produce niobium,
scandium and titanium at the Elk Creek Project; the outcome of
current recovery process improvement testing, and NioCorp's
expectation that such process improvements could lead to greater
efficiencies and cost savings in the Elk Creek Project; the Elk
Creek Project's ability to produce multiple critical metals; the
Elk Creek Project's projected ore production and mining operations
over its expected mine life; the completion of the demonstration
plant and technical and economic analyses on the potential addition
of magnetic rare earth oxides to NioCorp's planned product suite;
the exercise of options to purchase additional land parcels; the
execution of contracts with engineering, procurement and
construction companies; NioCorp's ongoing evaluation of the impact
of inflation, supply chain issues and geopolitical unrest on the
Elk Creek Project's economic model; the impact of health epidemics,
including the COVID-19 pandemic, on NioCorp's business and the
actions NioCorp may take in response thereto; and the creation of
full time and contract construction jobs over the construction
period of the Elk Creek Project. Forward-looking statements are
typically identified by words such as "plan," "believe," "expect,"
"anticipate," "intend," "outlook," "estimate," "forecast,"
"project," "continue," "could," "may," "might," "possible,"
"potential," "predict," "should," "would" and other similar words
and expressions, but the absence of these words does not mean that
a statement is not forward-looking.
The forward-looking statements are based on the current
expectations of the management of NioCorp and are inherently
subject to uncertainties and changes in circumstances and their
potential effects and speak only as of the date of such statement.
There can be no assurance that future developments will be those
that have been anticipated. Forward-looking statements reflect
material expectations and assumptions, including, without
limitation, expectations and assumptions relating to: the future
price of metals; the stability of the financial and capital
markets; and other current estimates and assumptions regarding the
Transactions and their benefits. Such expectations and assumptions
are inherently subject to uncertainties and contingencies regarding
future events and, as such, are subject to change. Forward-looking
statements involve a number of risks, uncertainties or other
factors that may cause actual results or performance to be
materially different from those expressed or implied by these
forward-looking statements. These risks and uncertainties include,
but are not limited to, those discussed and identified in public
filings made by NioCorp and GXII with the SEC and, in the case of
NioCorp, with the applicable Canadian securities regulatory
authorities and the following: the outcome of any legal proceedings
that may be instituted against NioCorp or GXII following closing of
the Transaction; the inability to access the full amount of net
proceeds under the Yorkville Equity Facility Financing over the
next three years; the ability to recognize the anticipated benefits
of the Transactions; unexpected costs related to the Transactions;
the completion of processes required to effect the trading of the
Common Shares on a post-Consolidation basis on the TSX and the
Nasdaq being delayed; NioCorp's ability to submit a complete
application to begin the EXIM Phase I evaluation process; NioCorp's
ability to pay the necessary fees in connection with the
Export-Import Bank of the United
States ("EXIM") underwriting process, including the expenses
of EXIM's or any other lenders' legal and other advisors and
NioCorp's own advisors; the completion of the Phase I due diligence
process and the receipt of a preliminary project letter indicating
that EXIM is prepared to undertake Phase II due diligence; the
completion of the Phase II due diligence process; the possibility
that, even if NioCorp completes the application process, it does
not receive a final commitment of financing from EXIM on the
anticipated timeline, on acceptable terms, or at all; NioCorp's
ability to operate as a going concern; NioCorp's requirement of
significant additional capital; NioCorp's limited operating
history; NioCorp's history of losses; cost increases for NioCorp's
exploration and, if warranted, development projects; a disruption
in, or failure of, NioCorp's information technology systems,
including those related to cybersecurity; equipment and supply
shortages; current and future offtake agreements, joint ventures,
and partnerships; NioCorp's ability to attract qualified
management; the effects of the COVID-19 pandemic or other global
health crises on NioCorp's business plans, financial condition and
liquidity; estimates of mineral resources and reserves; mineral
exploration and production activities; feasibility study results;
changes in demand for and price of commodities (such as fuel and
electricity) and currencies; changes or disruptions in the
securities markets; legislative, political or economic
developments; the need to obtain permits and comply with laws and
regulations and other regulatory requirements; the possibility that
actual results of work may differ from projections/expectations or
may not realize the perceived potential
of NioCorp's projects; risks of accidents, equipment
breakdowns, and labor disputes or other unanticipated difficulties
or interruptions; the possibility of cost overruns or unanticipated
expenses in development programs; operating or technical
difficulties in connection with exploration, mining, or development
activities; the speculative nature of mineral exploration and
development, including the risks of diminishing quantities of
grades of reserves and resources; claims on the title to NioCorp's
properties; potential future litigation; and NioCorp's lack of
insurance covering all of NioCorp's operations.
Should one or more of these risks or uncertainties materialize
or should any of the assumptions made by the management of NioCorp
and GXII prove incorrect, actual results may vary in material
respects from those projected in these forward-looking
statements.
All subsequent written and oral forward-looking statements
concerning the Transactions or other matters addressed in this
communication and attributable to NioCorp, GXII or any person
acting on their behalf are expressly qualified in their entirety by
the cautionary statements contained or referred to in this
communication. Except to the extent required by applicable law or
regulation, NioCorp undertakes no obligation to update these
forward-looking statements to reflect events or circumstances after
the date of this communication to reflect the occurrence of
unanticipated events.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/niocorp-closes-business-combination-with-gxii-and-separate-financing-deals-providing-access-to-up-to-us71-9-million-in-net-proceeds-over-the-next-three-years-301775355.html
SOURCE NioCorp Developments Ltd.
