Clermont Capital Provides Update on Proposed Transaction with NexGen Energy Ltd.
CLERMONT CAPITAL INC.
736 Granville Street, Suite 100 Vancouver, BC V7Z 1G3 Telephone: 604-684-6730 Fax: 604-684-6740
Not for Distribution to United States Newswire Services or for Dissemination in the United States.
NEWS RELEASE
CLERMONT CAPITAL PROVIDES UPDATE ON PROPOSED TRANSACTION WITH NEXGEN ENERGY LTD.
April 15, 2013 – Vancouver, BC – Clermont Capital Inc. (TSX-V: XYZ.P, “Clermont”) is pleased to announce that further to its news release dated March 11, 2013 regarding its acquisition (the “Acquisition”) of NexGen Energy Ltd. ("NexGen"), the TSX Venture Exchange (the "Exchange") has conditionally approved the Acquisition, NexGen has entered into an agreement amending certain terms of its option agreement with respect to the Radio Property in the Athabasca Basin, Saskatchewan, the shareholders of each of NexGen and Clermont have approved the Acquisition by the requisite majority and NexGen has completed a brokered placement raising approximately $4.2 million.
TSXV Conditional Approval
By letter dated April 11, 2013, the Exchange conditionally approved the Acquisition and the Acquisition is expected to close on April 19, 2013.
Amendments to Radio Option Agreement
In connection with the Exchange’s conditional approval of the Acquisition, NexGen entered into an agreement amending the terms of the option agreement (the “Option Amending Agreement”) between NexGen and Messrs. Lederhouse, Mason and Young (collectively, the “Optionors”) which grants NexGen the exclusive right and option to acquire a 70% interest in the Radio Project in exchange for a combination of cash and NexGen shares. The Option Amending Agreement amends the original option agreement by:
(i) making NexGen’s obligation to issue the Optionors that number of NexGen shares so that the Optionors will hold 20% of the shares of NexGen on a fully diluted basis on and as of December 5, 2013 and/or upon NexGen raising $21 million, subject to a maximum of 40 million shares, in aggregate;
(ii) deferring $5 million required expenditures from March 31, 2014 to May 31, 2014; and
(iii) deleting the put/call option in favour of a 30% free carried interest in the Radio Project to commercial production (defined as the first day of the month following the first period of 60 consecutive days during which ore has been shipped from the property at a rate of at least 85% of the milling rate specified in the feasibility study recommending commercial production) provided that said free carried interest shall also apply to any expansion of milling or production capacity after the commencement of commercial production.
The Option Amending Agreement also specifies that the joint venture agreement to be entered into upon NexGen exercising its option to acquire a 70% interest in the Radio Project, shall provide that: (i) if, for a period of nine consecutive months, either no work program is proposed or the work program in effect provides only for care and maintenance, the Optionors shall have the right to impose a work program and to the extent the Optionors fund said program and NexGen does not, NexGen’s interest shall be diluted by the amount spent by the Optionors on the basis that every $1 spent shall equal $1.50; (ii) any transfer of a party’s interest in the joint venture shall be subject to a right of first offer (replacing a previous provision imposing a right of first refusal) which shall be open for consideration by the non-selling party, for a period of 14 days; (iii) both parties shall be entitled to elect to receive its pro rata interest in the products produced from the property in kind or to require the operator to sell such products and remit the proceeds (less verifiable marketing costs incurred); and (iv) the Optionors shall have the right, but not the obligation, to lease to the operator of the joint venture any equipment, tools or other machinery at rates no higher than 5% more than the rates available from third party suppliers (provided that if the Optionors cannot or will not provide such equipment, tools or machinery within 45 days the operator may procure the equipment machinery or tools elsewhere).
Shareholder Approval
At the special meeting of Clermont shareholders held on March 14, 2013 (the "Special Meeting"). Clermont shareholders approved all resolutions as disclosed in Clermont's amended and restated information circular dated March 1, 2013 (the "Information Circular"). Specifically, the Clermont shareholders approved the consolidation of Clermont's common shares on a 2.35 for one basis, a corporate name change to “NexGen Energy Ltd." or such other name as NexGen, Clermont and the appropriate regulatory authority may approve, an increase to the number of directors from four to seven, and the election of three NexGen nominees to fill the resulting vacancies, effective upon completion of the Acquisition.
At a special meeting of NexGen shareholders also held on March 14, 2013, NexGen shareholders approved the Acquisition by the requisite majority.
Completion of NexGen Financing
In connection with the Acquisition, on March 12, 2013 NexGen completed a brokered private placement of 2,753,000 units (the “Units”) at a price of $0.40 per Unit and 7,256,500 common shares (“NexGen Shares”) which are being issued as “flow-through shares” for the purposes of the Income Tax Act (Canada) (the “Flow-Through Shares”) at a price of $0.425 per Flow-Through Share for aggregate gross proceeds of $4,185,212 (the “Brokered Private Placement”). The Brokered Private Placement was led by Secutor Capital Management Corporation and Marquest Capital Markets. Each Unit is comprised of one common share and one half of a common share purchase warrant (each whole warrant, a “Warrant”). Each Warrant entitles its holder to purchase a common share in the capital of NexGen for $0.60 per share for a period of 24 months commencing March 12, 2013, the closing date of the Brokered Private Placement.
NexGen also intends to complete a non-brokered private placement of approximately 1,587,500 Units at a price of $0.40 per Unit for gross proceeds of approximately $535,000 prior to completion of the Acquisition (the “Non-Brokered Placement”).
Update on Available Funds and Use of Funds
Based on the results of the Brokered Placement, the anticipated results of the Non-Brokered Placement, the terms of the Option Amending Agreement and the elapse of time since the date of the Information Circular, Clermont wishes to update the information regarding available funds and proposed use of available funds upon closing of the Acquisition:
Available Funds
| Estimated working capital of NexGen as at March 30, 2013 | $ 3,700,000 |
| Estimated working capital of Clermont as at March 30, 2013 | $ 1,004,898 |
| Net Escrow Funds | $ 694,000 |
| Proceeds of the Non-Brokered Financing | $ 535,000 |
| Total | $ 5,933,898 |
Anticipated Use of Available Funds
| Payment due under Radio Option Agreement on June 30, 2013 | $ 600,000 |
| To implement the recommended work program re: Radio Project | $ 4,100,000 |
| Estimated balance remaining of Clermont legal and accounting expenses, fees and the regulatory fees relating to the Acquisition | $ 60,000 |
| Estimated balance remaining of NexGen legal and accounting expenses, fees and the regulatory fees relating to the Acquisition | $ 200,000 |
| General & administrative expenses of the Resulting Issuer for the 12 months following completion of the Acquisition (1) | $ 873,898 |
| Unallocated working capital | $ 100,000 |
| Total | $ 5,933,898 |
Notes:
(1) General and administrative expenses consist of CEO and CFO remuneration and legal accounting costs in connection with continuous disclosure obligations.
Notwithstanding the foregoing, there may also be circumstances where, for sound business reasons, a reallocation of funds may be necessary to achieve the issuer’s business objectives.
Closing of the Acquisition
Completion of the Acquisition is still subject to a number of conditions, including completion of the share consolidation. The Acquisition cannot be completed until all conditions have been fulfilled or waived. There can be no assurance that the Acquisition will be completed as proposed or at all.
Investors are cautioned that, except as disclosed Information Circular, any information released or received with respect to the Acquisition may not be accurate or complete and should not be relied upon. Trading in the securities of Clermont should be considered highly speculative.
The Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.
The trading of the Clermont common shares will remain halted pending further filings with the Exchange.
FOR FURTHER INFORMATION PLEASE CONTACT:
Arlen Hansen, President, and CEO of Clermont Capital Inc.
Telephone: (604) 684-6730
The Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release. Neither the Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Information
This news release includes forward looking statements that are subject to assumptions, risks and uncertainties. All statements in this news release which are not historical are forward-looking statements. Examples of such statements in this news release include, but are not limited to, statements with respect to the Acquisition, and the receipt of regulatory approvals. Although Clermont believes that any forward-looking statements in this news release are reasonable, there can be no assurance that any such forward-looking statements will prove to be accurate. Clermont cautions readers that all forward- looking statements are based on assumptions, none of which can be assured, and are subject to certain risks and uncertainties that could cause actual events or results to differ materially from those indicated in the forward-looking statements. Readers are advised to rely on their own evaluation of such risks and uncertainties and should not place undue reliance on forward-looking statements.
The forward‐looking statements and information contained in this news release are made as of the date hereof and no undertaking is given to update or revise any forward‐looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws or the Exchange. The forward-looking statements or information contained in this news release are expressly qualified by this cautionary statement.