Montreal, March 27, 2018 – Niobay Metals Inc. (“Niobay” or the “Company”) (TSX-V: NBY) is pleased to announce that Osisko Gold Royalties Ltd (“Osisko”) (TSX:OR)(NYSE:OR) a has agreed to purchase, by way of a private placement, 9.0 million common shares of the Company (the “Shares”) at a price of $0.26 per share for proceeds of $2,340,000 (the “Financing”).
The Financing is expected to close on or about March 28, 2018, following which Osisko will own approximately 19.7% of Niobay’s issued and outstanding Shares on a non-diluted basis.
Pursuant to the subscription agreement entered into between Niobay and Osisko in connection with the Financing, so long as Osisko holds not less than 10% of the then issued and outstanding Shares of Niobay, Osisko will have the right to (i) nominate one director to Niobay’s board of directors and (ii) participate in all future equity financings to maintain its relative equity ownership in Niobay.
Upon closing of the Financing, Osisko will be granted an option to purchase a 1.0% royalty on all metals to be produced at the James Bay niobium project. The option will be exercisable by paying $2,000,000 to Niobay at any time within 90 days following the delivery by Niobay to Osisko of a bankable feasibility study on the project.
Claude Dufresne, President and CEO of Niobay, said “We are pleased to welcome Osisko as strategic investor. We view this investment as a vote of confidence in our company, our team and our James Bay Niobium asset, and we look forward to working together to develop our project and to build shareholder value.’’
The proceeds of the Financing will be used primarily to fund the development costs of Niobay’s niobium project and for general corporate purposes.
The Financing is subject to the final acceptance of the TSX Venture Exchange and certain other customary conditions. The Shares to be issued to Osisko will be subject to a hold period expiring four months and one day after the closing date.
About Niobay Metals Inc.
NioBay Metals Inc. is a mining exploration company holding a 100% interest in the James Bay Niobium property in Ontario, Canada. In addition, NioBay holds an option to acquire an interest of up to 65% in the La Peltrie gold project in northern Quebec, a 49% direct participation in certain mineral titles located in the Chibougamau region, Quebec, under a joint venture agreement with SOQUEM, and a 72.5% interest in the Crevier niobium and tantalum project, located in Quebec.
This news release contains certain “forward-looking information” under Canadian securities laws. All statements that address future activities, events or developments that the Company believes, expects or anticipates will or may occur are forward-looking information. Specifically, this news release contains forward looking information about the Company’s plans to complete the Financing on the terms announced and the intended use of proceeds. Forward looking information is based upon assumptions by management that are subject to known and unknown risks and uncertainties beyond the Company’s control, including the risk that the conditions to the Financing will not be satisfied. There can be no assurance that outcomes anticipated in the forward-looking information will occur, and actual results may differ materially for a variety of reasons. Accordingly, readers should not place undue reliance on forward-looking information. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking information, except as may be required by law.
The Shares to be issued under the Financing have not been, and will not be, registered under the U.S. Securities Act or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For more information, contact:
Claude Dufresne, P.Eng.
President & CEO
Niobay Metals Inc.
Tel.: 514 866-6500, Ext. 221