Northern Graphite Corporation, Ottawa, Canada, (TSXV: NGC) (OTCQB: NGPHF) announces that it plans to complete a non-brokered private placement of up to $2.8 million through the sale of up to 10 million units at a price of $0.28 per unit. Each unit will be comprised of one common share and one half of one share purchase warrant with each full warrant entitling the holder to purchase one common share at a price of $0.45 for a period of two years. All securities to be issued under the placement will be subject to a four month hold period from the date of closing. The placement is subject to approval by the TSX Venture Exchange.
It is anticipated that the net proceeds of the placement will be used to:
- Finalize operational permitting for the Bissett Creek graphite project;
- Continue testing various processes for upgrading mine concentrate into value added products; and
- Working capital and general corporate purposes.
To demonstrate continued support of the Company’s growth plans, certain insiders of the Company will participate in the placement. Such participation is considered a related party transaction within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The related party transaction will be exempt from minority approval and valuation requirements pursuant to the exemptions contained in Sections 5.5(a) and 5.7(1)(a) of MI 61-101, as neither the fair market value of the securities to be issued under the placement nor the consideration to be paid by the insiders will exceed 25% of the Company’s market capitalization.
Finder’s fees of up to 6% of subscription amounts may be paid in cash on all or any portion of the funds raised pursuant to the placement.
About Northern Graphite
Northern owns 100% of the Bissett Creek graphite deposit which is located in the southern part of Canada between the cities of North Bay and Ottawa, and 15 km from the Trans-Canada highway. It has the benefit of ready access to labour, supplies, equipment, natural gas and concentrate transportation. Bissett Creek is an advanced stage project with a Feasibility Study and its major mining permit. Operational permitting is well advanced and the Company is in a position to make a construction decision subject to full project financing.
A recent independent study estimated that Bissett Creek will have the highest margin of any existing or proposed graphite deposit. This is due to simple metallurgy, the high purity, large flake nature of its concentrates and a very favorable location. Because of these factors the Project has a reasonable capital cost and is economic at current prices using an initial production rate that is realistic relative to the size of the existing market. Sufficient measured and indicated resources have already been drilled off to substantially increase production as demand grows. The high percentage of large flake concentrates will enable the Company to initially focus on high margin, value-added industrial markets and to expand into the lithium ion battery (“LiB”) market as EV demand grows and small flake prices increase.
