Nemaska Lithium Concludes a USD 150M Streaming Agreement with Orion

12 April 2018

QUEBEC, QUEBEC--(Marketwired - April 12, 2018) - Nemaska Lithium Inc. ("Nemaska Lithium" or the "Corporation") (TSX:NMX)(OTCQX:NMKEF)(FRANKFURT:N0T) is pleased to update its project financing plans and confirm that it has entered into a USD 150M streaming agreement (the "Streaming Agreement") with Orion Mine Finance II LP ("Orion").

In a press release dated March 28, 2018, Nemaska Lithium outlined the components of its overall USD 775 - 825M financing structure to fund the construction, commissioning, working capital and reserve funds for its Whabouchi lithium mine and Shawinigan electrochemical plant (the "Project Financing") and also for general corporate working capital. Since that time, the Corporation has made steady progress on the following:

  • Streaming facility for USD 150M - the Corporation:

    • Signed the Streaming Agreement with Orion for same amount;

  • Equity offerings through private and/or public offerings - the Corporation:

    • Obtained, on March 29, 2018, a receipt from Canadian securities regulatory authorities for its final base shelf prospectus (filed on Sedar the same day);
    • Issued, on April 5, 2018, a press release outlining the agreed terms of a private placement for up to CAD 99M with SoftBank Group Corp. to hold no more than 9.9% of the shares outstanding once the project financing is completed; and
    • Expects to provide further details in the short-term on current discussions for the additional equity financing required;

  • Debt financing aggregating USD 300-350M - the Corporation:

    • Expects to provide further details in the short-term as regards its continuing debt financing endeavours.

"We have made solid progress in our project financing endeavours over the past couple of weeks, firstly with a private placement with SoftBank, a global technology leader, and now with the signing of this agreement with Orion, a leading and well-regarded financier in the mining industry," said Guy Bourassa, President & C.E.O. of Nemaska Lithium. "This Streaming Agreement is a financing tool which limits shareholder dilution, lowers Nemaska Lithium's cost of capital, and is under terms which are both competitive and flexible," Bourassa continued.

Michael Barton, Portfolio Manager at Orion Resource Partners (UK) LLP said, "Orion is delighted to become a major investor in one of the most exciting lithium projects globally. We look forward to supporting Nemaska Lithium as Whabouchi and Shawinigan enter the next phase of development."

The Streaming Agreement provides for the sale and delivery to Orion of 14.5% on all lithium hydroxide and lithium carbonate produced at the Shawinigan plant and sold to third parties (collectively, "Stream Products"). Orion's purchase price paid to Nemaska Lithium under the Streaming Agreement will be 40% of the sales proceeds of such Stream Products. Nemaska Lithium will act as Orion's agent in the sale of the Stream Products to third-party off-takers. Through this arrangement, Orion will receive 60% of the sales proceeds from such Stream Products, which will result in Orion receiving a net portion of approximately 8.7% of the Stream Products sales. The maximum amount of Stream Products deliverable per year will not exceed the equivalent of 5,000 tonnes of refined lithium products.

In consideration of the Streaming Agreement, Orion will make an advance payment equal to USD 150M to Nemaska Lithium Shawinigan Transformation Inc., a wholly-owned subsidiary of Nemaska Lithium. The advance payment will be released in two equal tranches of USD 75M with the first tranche expected to be payable once the Project Financing is in place and once Nemaska Lithium has satisfied certain customary conditions which it expects to satisfy soon after the Project Financing completion. The second tranche will be payable upon the satisfaction of certain technical and other customary conditions that must be satisfied no later than December 31, 2019. In the event that these latter conditions are not satisfied, the second tranche will not be released and the percentage of Stream Products will be reduced from 14.5% to 7.5%.

About Nemaska Lithium

Nemaska Lithium is a developing chemical company whose activities will be vertically integrated, from spodumene mining to the commercialization of high-purity lithium hydroxide and lithium carbonate. These lithium salts are mainly destined for the fast-growing lithium-ion battery market, which is driven by the increasing demand for electric vehicles and energy storage worldwide. With its products and processes, Nemaska Lithium intends to facilitate access to green energy, for the benefit of humanity.

The Corporation will be operating the Whabouchi mine in Québec, Canada, one of the richest lithium spodumene deposits in the world, both in volume and grade. The spodumene concentrate produced at the Whabouchi mine will be processed at the Shawinigan plant using a unique membrane electrolysis process for which the Corporation holds several patents.

Nemaska Lithium is a member of the S&P/TSX SmallCap Index, S&P/TSX Global Mining Index, S&P/TSX Global Base Metals Index, S&P/TSX Equal Weight Global Base Metals Index, and the MSCI Canada Small Cap Index. For more information, visit nemaskalithium.com or twitter.com/Nemaska_Lithium.

About Orion

The Orion Mine Finance Group is a mining-focused investment business with USD 4.5 billion under management (as of January 31, 2018). Orion specializes in providing comprehensive and customized capital investment solutions to mining companies.

Cautionary Statement on Forward-Looking Information

All statements, other than statements of historical fact, contained in this press release including, but not limited to, those relating to the Corporation receiving the USD 150M advance payment under the Streaming Agreement and to the completion of the Project Financing (or any component thereof) in general, constitute "forward-looking information" and "forward-looking statements" within the meaning of certain securities laws and are based on expectations and projections as of the date of this press release. Certain important assumptions by the Corporation in making forward-looking statements include, but are not limited to, (a) the satisfaction, in a timely manner, by the Corporation of conditions precedent to the payment of each USD 75M tranche of the advance payment, (b) the receipt by the Corporation of proceeds therefrom, and from all other components of the Project Financing, and (c) the Corporation having raised a sufficient amount under all components of the Project Financing to bring the Whabouchi mine and the Shawinigan plant to commercial production.

Forward-looking statements contained in this press release include, without limitation, those related to (i) the sale and delivery to Orion of the above-mentioned percentages (14.5% and 8.7% net) of Stream Products, (ii) the eventual sharing of proceeds from Stream Products between Orion and the Corporation, (iii) the Streaming Agreement being a financing tool that limits shareholder dilution and lowers cost of capital, (iv) the satisfaction of conditions no later than December 31, 2019 for the second tranche payment, (v) the Corporation's project being one of the most exciting globally and entering in its next phase of development, (vi) the Corporation providing further details regarding the equity and debt components of the Project Financing in the short-term, and (vii) generally, the above "About Nemaska Lithium" paragraph which essentially describe the Corporation's outlook, constitute ''forward-looking information'' or ''forward-looking statements'' within the meaning of certain securities laws, and are based on expectations, estimates and projections as of the time of this press release. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Corporation as of the time of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. These estimates and assumptions may prove to be incorrect.

Many of these uncertainties and contingencies can directly or indirectly affect, and could cause, actual results to differ materially from those expressed or implied in any forward-looking statements. There can be no assurance that a comprehensive USD 775M to USD 825M Project and general corporate working capital financing package will be put in place and that any component of the Project Financing will be completed, as the next steps and, eventually, the actual results of financing endeavors, in particular as regards the debt financing and the equity offerings, and future events could differ materially from those anticipated in such statements.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. Forward-looking statements are provided for the purpose of providing information about management's endeavors to complete its project financing and, more generally, its expectations and plans relating to the future. Readers are cautioned not to place undue reliance on these forward-looking statements as a number of important risk factors and future events could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates, assumptions and intentions expressed in such forward-looking statements. All of the forward-looking statements made in this press release are qualified by these cautionary statements and those made in our other filings with the securities regulators of Canada including, but not limited to, the cautionary statements made in the "Risk Factors" section of the Corporation's Annual Information Form dated October 5, 2017 and the "Risk Exposure and Management" section of the Corporation's quarterly Management Discussion & Analysis. The Corporation cautions that the foregoing list of factors that may affect future results is not exhaustive, and new, unforeseeable risks may arise from time to time. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law.

Further information regarding Nemaska Lithium is available in the SEDAR database (www.sedar.com) and on the Corporation's website at: www.nemaskalithium.com.