Lithium Royalty Corp. Announces Completion of Initial Public Offering
/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES NEWS WIRE SERVICES./
TORONTO, March 15, 2023 /CNW/ - Lithium Royalty Corp. ("LRC") is pleased to announce the successful closing of its previously announced initial public offering. Pursuant to the offering, LRC sold an aggregate of 8,824,000 common shares at an offering price of C$17.00 per share, for aggregate gross proceeds of approximately C$150 million.
The offering was co-led by Canaccord Genuity Corp. and Citigroup Global Markets Canada Inc., together with TD Securities Inc., Cormark Securities Inc., National Bank Financial Inc., BMO Capital Markets, Scotiabank, Raymond James Ltd. and Red Cloud Securities Inc. as underwriters.
The underwriters have been granted an over-allotment option to purchase up to an additional 1,323,600 common shares at a price of C$17.00 per share, for additional gross proceeds of approximately C$22.5 million if the over-allotment option is exercised in full. The over-allotment option can be exercised until April 14, 2023.
The common shares are listed on the Toronto Stock Exchange in Canadian dollars under the symbol "LIRC".
The offering was completed pursuant to LRC's supplemented PREP prospectus dated March 8, 2023, and filed with the securities regulators in each of the provinces and territories of Canada, a copy of which is available under LRC's profile on SEDAR at www.sedar.com.
No securities regulatory authority has either approved or disapproved the contents of this news release. The common shares have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws. Accordingly, the common shares may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or pursuant to exemptions from the registration requirements of the U.S. Securities Act and applicable state securities laws. This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any securities of LRC in any jurisdiction in which such offer, solicitation or sale would be unlawful.
On or around March 12, 2023, in connection with the initial public offering, LRC completed a series of transactions (the "Pre-Closing Reorganization") pursuant to which, among other things, LRC amended its articles to re-designate its Class C common shares as common shares (the "Common Shares") and to create convertible common shares (the "Convertible Common Shares" and, together with the Common Shares, the "Equity Shares") of LRC. The then existing Class A common shares and Class B common shares of LRC were then exchanged for Convertible Common Shares on a one-to-one basis. As a result, (i) Waratah Capital Advisors Ltd. ("Waratah", and together with its affiliates, controlling persons and investment funds managed by it and its affiliates, including Royalty Capital I Limited Partnership, Royalty Capital II Limited Partnership, Royalty Capital I-II Limited Partnership and Royalty Capital II-II Limited Partnership (collectively, the "Waratah Group")) acquired direct and indirect ownership and control of 30,549,214 Convertible Common Shares, and (ii) Riverstone VI LRC B.V. ("Riverstone", and together with the Waratah Group, the "Principal Shareholders") acquiring 15,912,472 Common Shares.
Immediately following the Pre-Closing Reorganization but before giving effect to the offering and without giving effect to Waratah's call option to acquire additional common shares from Riverstone for up to an estimated 5% of the issued and outstanding shares, (i) the Waratah Group directly and indirectly owned or controlled 30,549,214 Convertible Common Shares (representing approximately 66% of the issued and outstanding Equity Shares) and (ii) Riverstone directly owned and controlled 15,912,472 Common Shares (representing approximately 34% of the issued and outstanding Equity Shares). After giving effect to the offering, (i) the Waratah Group directly and indirectly owned or controlled 30,549,214 Convertible Common Shares (representing approximately 55.26% of the issued and outstanding Equity Shares) and (ii) Riverstone directly owned and controlled 15,912,472 Common Shares (representing approximately 28.78% of the issued and outstanding Equity Shares), in each case, assuming the over-allotment option is not exercised.
In connection with the Pre-Closing Reorganization, the Company disposed of portfolio securities, including securities of ACME Lithium Inc. ("ACME") and Noram Lithium Corp. ("Noram"), offtakes and workings interests it held, together with excess cash, by directly or indirectly distributing them by way of return of capital and dividends to the Principal Shareholders.
The Common Shares and Convertible Common Shares are substantially identical, except for the conversion feature attached to the Convertible Common Shares. Each Convertible Common Share is convertible, at the option of the holder at any time, into either (i) one Common Share or (ii) 0.9999 of a Common Share plus a subscription right to acquire 0.0001 Common Shares for an exercise price of US$0.00001 per whole Common Share. Each Convertible Common Share also automatically converts into one Common Share in certain other circumstances, including on March 15, 2028, as further described in the prospectus.
The securities of LRC were acquired by the Principal Shareholders for general investment purposes. Depending on various factors, including, without limitation, market conditions, general economic and industry conditions, LRC's business and financial condition and/or any other factors that the Principal Shareholders may deem relevant, the Principal Shareholders may take such actions with respect to their investment in LRC as they deem appropriate including, without limitation, acquiring, exercising, converting, exchanging, selling, distributing to investors in the Principal Shareholders or otherwise disposing of securities of LRC or securities exercisable for, or convertible or exchangeable into, securities of LRC from time to time, subject to applicable laws and the terms of LRC's articles and of the lock up agreements, and investor rights agreement entered into by certain of them, each as described in the prospectus.
The Common Shares are currently listed for trading on the Toronto Stock Exchange, while the Convertible Common Shares are not listed on a marketplace. For further information and to obtain a copy of the early warning reports to be filed under applicable Canadian securities laws in connection with the foregoing matters, please see (i) LRC's profile on SEDAR, (ii) ACME's profile on SEDAR, and (iii) Noram's profile on SEDAR, in each case at www.sedar.com.
A copy of the Early Warning Reports to be filed in respect of the transactions contemplated hereby can be obtained by contacting Philip Panet at 416-687-6792 or [email protected] in respect of Waratah or Josh Prentice at 212-993-0076 in respect of Riverstone.
LRC is a lithium-focused royalty company with a globally diversified portfolio of 29 royalties on mineral properties around the world that supply and are expected to supply raw materials to support the electrification of transportation and decarbonization of the global economy. Our portfolio is focused on high-grade and low cost mineral projects that are primarily located in Australia, Canada, South America and the United States. LRC is a signatory to the United Nations Principles for Responsible Investment and the integration of ESG factors and sustainable mining are important considerations in our investment analysis and royalty acquisitions.
This news release contains "forward-looking information" within the meaning of applicable Canadian securities legislation, including statements with regard to the potential closing of the over-allotment option. Forward-looking information involves known and unknown risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These risks and uncertainties include, but are not limited to, those described under "Risk Factors" in our supplemented PREP prospectus dated March 8, 2023. Forward-looking information is based on management's beliefs and assumptions and on information currently available to management. Although the forward-looking information contained in this news release is based upon what management believes are reasonable assumptions, you are cautioned against placing undue reliance on this information since actual results may vary from the forward-looking information. Unless otherwise noted or the context otherwise indicates, the forward-looking information contained in this news release is provided as of the date of this news release, and we do not undertake to update or amend such forward-looking information whether as a result of new information, future events or otherwise, except as may be required by applicable law.
SOURCE Lithium Royalty Corp.
Contact Information for Inquiries: Ernie Ortiz, Chief Executive Officer, 416-572-3900, [email protected]
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