LONDON, April 4, 2019 /CNW/ - This news release is issued by Pallinghurst Graphite Limited ("Pallinghurst") pursuant to the early warning requirements of Canada's National Instrument 62-104 and National Instrument 62-103 with respect to common shares of Nouveau Monde Graphite Inc. (the "Issuer").
Pallinghurst announces that it has entered into a subscription agreement with the Issuer to purchase 43,825,000 common shares at a price of $0.235 per common share in a private placement transaction for a total subscription amount of $10,298,875 (the "Transaction"). Immediately prior to the Transaction, Pallinghurst had beneficial ownership and control over no common shares of the Issuer. Following the closing of the Transaction, Pallinghurst will have beneficial ownership and control over 43,825,000 common shares representing approximately 19.99% of the then issued and outstanding common shares of the Issuer.
Pallinghurst will acquire the common shares for investment purposes. The Issuer and Pallinghurst have agreed to work together exclusively for a 60 day-period from the closing of the Transaction to determine and negotiate the most appropriate equity funding plan for the entire capital required to bring the Issuer's Matawinie Project into production. While Pallinghurst is under no obligation to reach an agreement on a funding plan, any agreement would result in the acquisition of further common shares by Pallinghurst.
At the closing of the Transaction, Pallinghurst will also be granted (i) anti-dilution rights in respect of subsequent offerings for capital raises and subsequent issuances of securities by the Issuer in order to maintain its 19.99% ownership, which will continue for up to two years from closing of the Transaction, and (ii) a right of first refusal over additional financings until the end of fiscal year 2019. Pallinghurst has also agreed that it will not sell its common shares for up to two years following the closing of the Transaction. Finally, until December 31, 2019, Pallinghurst has agreed to vote its common shares at each meeting of shareholders of the Issuer at which directors are elected in favour of the persons nominated by the Issuer for election as directors. Pallinghurst also has a right of first refusal over any equity financing transaction to be conducted by the Issuer until December 31, 2019, with limited exceptions.
For further information and to obtain a copy of the early warning report filed under applicable Canadian provincial securities legislation in connection with the Transaction, please go to the Issuer's profile on the SEDAR website (www.sedar.com) or contact Chris Shepherd at +44 207 518 3399. Pallinghurst has its registered office at 1 New Burlington Place, London W1S 2HR, United Kingdom.
SOURCE Pallinghurst Graphite Limited