NZC-TSX
NORZF-OTCQB
VANCOUVER, BC, Dec. 13, 2021 /CNW/ - NorZinc Ltd.
(TSX: NZC) (OTCQB: NORZF) (the "Company" or
"NorZinc") is pleased to announce the closing of an equity
financing agreement (the "Equity Financing") with RCF VI CAD
LLC ("RCF"). Pursuant to the Equity Financing, the Company
issued an aggregate of 68,451,708 common shares of the Company
("Common Shares") to RCF on a non-brokered private placement
basis, at a price of $0.048363 per
share for gross proceeds of approximately $3.3 million.
The proceeds from the Equity Financing will be used to progress
plans on Phase 1 of the All-Season Road ("ASR") and other
construction needs of the Prairie Creek Project as well as for
general corporate purposes.
Rohan Hazelton, President
& CEO of NorZinc stated, "This represents the most
significant milestone yet in the advancement of the Prairie Creek
Project as it enables the commencement of construction of the
all-season access road, marking the start of the development phase
of the Company. Ultimately, this will be the first all-season road
to Prairie Creek in the project's 50-year history. The first phase
of construction, known as the pioneer winter road, will re-open and
cut new trails, where designated, along the access road corridor,
allowing for acquisition of critical geotechnical data for
subsequent road-building campaigns and to walk in key pieces of
heavy equipment required for on-site early construction projects in
the following summer season."
"Construction of the road is key to remaining on track
with our targeted development schedule and production expected in
late 2024. This transaction keeps the project progressing while we
evaluate financing alternatives for complete scope of this pioneer
winter road and the broader project. We are very
pleased to receive continued financial, as well as technical,
support from our major shareholder RCF allowing us to remain on
schedule."
"The Company continues to consider multiple development
financing activities for the activities in the coming year
pending availability of suitable financing along with permit
readiness activities."
"The Company also plans to formally initiate an updated
Feasibility Study in December 2021
following initial feasibility level work completed over the past
month. The study will seek to build on the robust results of the
October 2021 Preliminary Economic
Assessment, and provide a higher level of detail and confidence,
while exploring the multiple opportunities for optimization
and expansion previously
identified."
Common Shares issued in the Equity Financing will be subject to
a four-month hold period under applicable Canadian securities
laws.
Early Warning Disclosure
RCF is providing the following additional information pursuant
to the early warning requirements of applicable Canadian securities
laws:
RCF acquired 68,451,708 Common Shares for an aggregate purchase
price of $3,310,529.95, which
increased RCF's aggregate shareholding percentage in the Common
Shares (together with its affiliates) by approximately 5.14 %.
Immediately prior to the closing of the Equity Financing, RCF
(together with its affiliates) beneficially owned an aggregate of
297,427,065 Common Shares and 7,692,307 warrants of the Company
("Warrants"), representing approximately 43.45% of the
issued and outstanding Common Shares, or 305,119,372 Common Shares
(44.08%) on a partially-diluted basis assuming exercise of the
Warrants. Immediately following closing of the Equity Financing,
RCF (together with its affiliates) beneficially owns an aggregate
of 365,878,773 Common Shares and 7,692,307 Warrants, representing
approximately 48.59% of the 752,968,790 Common Shares that are
issued and outstanding as of the closing date of the Equity
Financing, or 373,571,080 Common Shares (49.11%) on a
partially-diluted basis assuming exercise of the Warrants.
The Common Shares were acquired for investment purposes. RCF may
from time to time acquire additional securities, dispose of some or
all of the existing or additional securities, or may continue to
hold the securities of the Company. Pursuant to a second amended
and restated investor rights agreement dated April 24, 2020 between RCF and the Company, RCF
has the right to participate in future equity financings of the
Company to maintain its then current equity ownership in the
Company on terms no less favourable than those offered to other
investors in such financings (subject to certain exceptions).
RCF's head office is located at 1400 Wewatta Street, Suite 850,
Denver, CO, 80202. NorZinc's
address is 701 West Georgia Street, Suite 1875, Vancouver, BC V7Y 1C6. A copy of RCF's early
warning report in respect of the Equity Financing may be obtained
by contacting Molly Campbell at +1
720 946 1444.
MI 61-101 Disclosure
RCF is an insider of the Company. Accordingly, the Equity
Financing is considered to be a "related party transaction" for
purposes of Multilateral Instrument 61-101 – Protection of
Minority Security Holders in Special Transactions ("MI
61-101"). Pursuant to MI 61-101, the Company will file a
material change report providing disclosure in relation to each
"related party transaction" on SEDAR under NorZinc's issuer profile
at www.sedar.com. The Company did not file the material change
report more than 21 days before the expected closing date of the
Equity Financing as the details of the Equity Financing and the
participation therein by the "related party" of the Company were
not settled until shortly prior to the closing of the Equity
Financing, and the Company wished to close the Equity Financing on
an expedited basis for business reasons. The Company is relying on
exemptions from the formal valuation and minority shareholder
approval requirements available under MI 61-101. The Company is
exempt from the formal valuation requirement in section 5.4 of MI
61-101 in reliance on section 5.5(a) of MI 61-101 as the fair
market value of the transaction, insofar as it involves interested
parties, is not more than the 25% of the Company's market
capitalization. Additionally, the Company is exempt from minority
shareholder approval requirement in section 5.6 of MI 61-101 in
reliance on section 5.7(1)(b) as the fair market value of the
transaction, insofar as it involves interested parties, is not more
than the 25% of the Company's market capitalization.
About NorZinc
NorZinc is a TSX-listed mine development Company trading under
the symbol "NZC" and on the OTCQB under the symbol "NORZF". NorZinc
is focused on developing its 100%-owned high-grade zinc-silver-lead
Prairie Creek Project, located in the Northwest Territories
Cautionary Statement – Forward-Looking Information
This press release contains forward-looking information,
including, among other things, statements regarding the use of
proceeds from the Equity Financing, the impact of the ASR on the
Prairie Creek Project the development of the Prairie Creek Project,
the Company's plans and objectives in connection therewith and the
initiation of an updated Feasibility Study. In making the
forward-looking statements in this release, the Company has applied
certain factors and assumptions that the Company believes are
reasonable, including that the Company will be able to use the
proceeds of the Equity Financing as anticipated, that the impacts
of the ASR on the Prairie Creek Project will be as expected and
that the Company will be able to carry out its plans as
anticipated. However, the forward-looking statements in this
release are subject to numerous risks, uncertainties and other
factors that may cause future results to differ materially from
those expressed or implied in such forward-looking statements. Such
uncertainties and risks include, among others, risks related to the
COVID-19 global health crisis, financing risks, delays in obtaining
or inability to obtain required regulatory approvals, inability to
use the proceeds from the Equity Financing and inability to
complete the ASR or carry out its business plans as anticipated as
well as all of the risk factors described in the Company's most
recent Annual Information Form and Management's Discussion &
Analysis available for review on the Company's profile at
www.sedar.com. The Company disclaims any intention or obligation to
update or revise any forward-looking information, except as
required by applicable law.
SOURCE NorZinc Ltd.