Northern Graphite Corporation (TSXV:NGC) signed a binding purchase and sale agreement to acquire all of the assets of Lac des lles graphite mine in Quebec from Imerys S.A. (ENXTPA:NK) on December 2, 2021. In a related transaction, Northern Graphite Corporation (TSXV:NGC) signed a binding purchase and sale agreement to acquire Imerys Geckco Holdings (Namibia)(Pty) Ltd. The total consideration for both transactions is approximately $40 million. The transaction shall be financed through a combination of debt, sale of a royalty and stream on the assets being acquired and other support from Imerys.

Northern has signed a term sheet with Sprott for $40 million in financing consisting of a $15 million senior secured debenture, US$5 million for a royalty on Lac des lles graphite mine and a $20 million stream financing on the Namibian project. Northern Graphite Corporation plans to conduct a brokered private placement of subscription receipts for proceeds of up to $15 million. The Sprott group intends to participate in the offering with a total investment of $3 million and Imerys will receive $3 million in equity, on the same terms as the offering, as partial payment of the purchase price.

NorthernGraphite Corporation anticipates that the equity financing will be oversubscribed and that the over allotment option will be exercised. The transaction is subject to customary closing conditions including closing of the related acquisition financings and receipt of regulatory and other approvals, including the approval of the TSX-V. Completion of the transaction is targeted for on or about January 15, 2022.