VANCOUVER, BC, May 8, 2024
/CNW/ - NexGen Energy Ltd. ("NexGen" or the
"Company") (TSX: NXE) (NYSE:
NXE) (ASX: NXG) is pleased to announce that it has entered into a
binding term sheet with MMCap International Inc. SPC ("MMCap") for
the purchase (the "Purchase") of 2,702,410
pounds natural uranium concentrate
("U3O8") for an aggregate
purchase price of US$250 million
based on the five day average UxC spot price.
In satisfaction of the purchase price for
the U3O8, the Company has agreed
to issue US$250 million aggregate
principal amount of unsecured convertible debentures (the
"Debentures"). The Debentures will be convertible at the holder's
option into approximately 23 million common shares of
NexGen (the "Common Shares") equivalent to ~4.3% of the Company's
issued and outstanding Common Shares.
Upon closing of the previously announced
Australian Chess Depository Interest ("CDI") offering, as well as
this transaction with MMCap, the Company will have ~C$600 million in cash and US$250 million worth of physical uranium on its
balance sheet.
Leigh Curyer, Chief Executive Officer,
commented: "At a time when available physical uranium is extremely
tight and expected to continue to be scarce given the long-term
supply deficit, this purchase represents a strong opportunity for
the Company to bolster its marketing discussions and optimises the
optionality of project financing structures under evaluation.
The Company is at a pivotal time, shaping the industry towards
transparency, whilst prioritising local community engagement and
participation in Saskatchewan and
Canada, and providing the globe
with clean energy fuel. The transaction is also a significant
endorsement of NexGen's approach, role and opportunity in the
nuclear sector. Upon closing of the CDI offering and this
strategic uranium purchase, the Company will hold cash and uranium
worth over C$930 million and will
significantly assist the Company in funding the anticipated capital
needs to develop the Rook I Project."
Strategic Alignment
Provisions
In connection with the Debenture issuance,
the Company will enter into an investor rights agreement with
MMCap, containing voting alignment, standstill, and sale and
transfer restriction covenants.
Terms of the
Debentures
The Debentures will carry a 9.0% coupon
(the "Interest") over a 5-year term. The Debentures will be
convertible at the holder's option into Common Shares, at a
conversion price (the "Conversion Price") per Common Share of
US$10.73 (C$14.70 per Common Share equivalent incorporating
today's exchange rate) representing a 30% premium to the
volume-weighted average trading price (the "VWAP") per Common Share
on the Toronto Stock Exchange (the "TSX") for the 5-days ending on
the day prior to the date of this announcement.
Two-thirds of the Interest (equal to 6% per
annum) is payable in cash. One-third of the Interest (equal to 3%
per annum) is payable in Common Shares issuable at a price equal to
the 20-day VWAP on the New York Stock Exchange (the "NYSE") ending
on, and including, the third trading day prior to the date such
interest payment is due.
The Company will be entitled, on or after
the third anniversary of the date of the issuance of the
Debentures, at any time that the 20-day VWAP on the NYSE exceeds
130% of the Conversion Price, to redeem the Debentures at par plus
accrued and unpaid Interest.
The Company agreed to issued to MMCap an
aggregate of 909,090 Common Shares as an establishment fee in
connection with the Debentures, representing 3% of the aggregate
principal amount of the Debentures.
Conditions
Closing of the Purchase is conditional upon
the satisfaction of customary closing conditions prior to
June 28, 2024,
including stock exchange approvals and third-party approvals
required for the transfer of the
U3O8 and issuance of the
Debentures and the completion of definitive
documentation.
Farris LLP were legal advisors to NexGen
and Wildeboer Dellelce LLP advised MMCap.
About
NexGen
NexGen Energy is a Canadian company focused
on delivering clean energy fuel for the
future. The
Company's flagship Rook I
Project is being optimally developed into
the largest low cost producing uranium mine globally, incorporating
the most elite standards in environmental and social
governance. The Rook I Project
is supported by a NI 43-101 compliant
Feasibility Study which outlines the elite environmental
performance and industry leading
economics. NexGen is led by a team of
experienced uranium and mining industry professionals with
expertise across the entire mining life cycle, including
exploration, financing, project engineering
and construction, operations and
closure. NexGen is leveraging its proven
experience to deliver a Project that leads the entire mining
industry socially, technically and
environmentally. The Project and
prospective portfolio in northern Saskatchewan will provide generational
long-term economic, environmental, and social benefits for
Saskatchewan, Canada, and the
world.
NexGen is listed on the Toronto Stock
Exchange, the New York Stock Exchange under the ticker symbol "NXE"
and on the Australian Securities Exchange under the ticker symbol
"NXG" providing access to global investors to participate in
NexGen's mission of solving three major global challenges in
decarbonization, energy security and access to
power. The Company is headquartered in
Vancouver, British Columbia, with
its primary operations office in Saskatoon, Saskatchewan.
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SOURCE NexGen Energy Ltd.