TORONTO,
Dec. 19,
2024 /CNW/ - Blue Moon Metals Inc. ("Blue
Moon" or the "Company") (TSXV: MOON), Nussir
ASA ("Nussir") and Nye Sulitjelma Gruver
AS ("NSG") are pleased to announce that the
parties have entered into separate definitive agreements (the
"Definitive Agreements"), each dated December 19, 2024, pursuant to which Blue Moon
has agreed to acquire all of the issued and outstanding shares of
Nussir and NSG (the "Acquisitions"). Both Nussir and
NSG are private Norwegian companies with properties in northern
Norway (the "Nussir
Property" and the "NSG Property," respectively).
Pursuant to the Definitive Agreements, Blue Moon has agreed to
acquire a 99.5% interest in Nussir and a 100% interest in NSG, to
be satisfied by the issuance to Nussir and NSG shareholders of up
to 313,142,828 common shares of Blue Moon (the "Blue Moon
Shares") at a deemed price of C$0.30 per Blue Moon Share. NSG shareholders will
also receive US$3 million in cash
milestone payments related to the receipt of permitting for
tailings discharge and receipt of the operating permit for the NSG
Property. Further details about the Acquisitions are disclosed in
Blue Moon's news release dated November 27,
2024.
Blue Moon has also closed its previously
announced brokered private placement in tandem with entering into
the Definitive Agreements, raising C$30
million (the "Concurrent Financing"). More details on
the Concurrent Financing can be found below. The implied equity
value of the Acquisitions and the Concurrent Financing,
collectively, is approximately US$100
million on a fully-diluted in-the-money basis. At closing of
the Acquisitions, existing Blue Moon, Nussir and NSG shareholders
are expected to own 12%, 55% and 12%, respectively, of Blue Moon
Shares outstanding on a fully-diluted in-the-money basis. No one
shareholder is expected to own more than 20% of the Blue Moon
Shares. The Concurrent Financing has received conditional TSX
Venture Exchange ("TSXV") approval and is subject to final
TSXV approval. The Acquisitions are subject to acceptance by the
TSXV in all respects, as they are each considered a "Reviewable
Transaction" under the policies of the TSXV. As per TSXV
requirements, trading of the Blue Moon Shares is halted and will
resume after the TSXV has received all required documentation,
including a technical report on the Nussir Property prepared in
accordance with National Instrument 43-101, among other customary
items. Closing of the Acquisitions is expected by the end of
February 2025, at which point the
maiden preliminary economic assessment on the Company's existing
Blue Moon property (the "Blue Moon Property") is also
anticipated to be released. Blue Moon looks forward to
communicating its new plan for the Norwegian assets once the stock
starts trading again in 2025.
Concurrent Financing
Pursuant to the first tranche closing of the
Concurrent Financing, Blue Moon issued 10,000,031 units (the
"Units") of the Company at a price of C$3.00 per Unit for gross proceeds C$30,000,093. The Concurrent Financing is co-led
by Cormark Securities Inc. and Scotiabank on behalf of a
syndicate of investment dealers including National Bank Financial
Inc., Haywood Securities Inc., Raymond James Ltd. and CIBC World
Markets Inc. (collectively, the "Agents"). The Company may
close additional tranches of the Concurrent Financing, for up to
cumulative total gross proceeds of C$50,000,000.
Each Unit issued in the Concurrent Financing
consists of 1 common share of Blue Moon (each, a "Unit
Share") and 9 subscription receipts (each, a "Subscription
Receipt"), with 10% of the price per Unit allocated to the Unit
Share underlying each Unit and 90% of the price per Unit allocated
to the Subscription Receipts underlying each Unit. The net proceeds
allocated to the Unit Shares were released to Blue Moon upon
closing of the Concurrent Financing and will not be returned to the
subscribers in the event the Escrow Release Conditions (as defined
below), which include the completion of the Acquisitions, are not
met.
Upon completion of the Acquisitions, and subject
to certain customary conversion conditions for a transaction of
this nature (collectively, "Escrow Release Conditions"),
each Subscription Receipt will convert into one common share of
Blue Moon (each, an "Underlying Share") without payment of
additional consideration or further action on the part of the
holder.
Blue Moon has agreed to pay to the Agents a
commission equal to 6.0% of the gross proceeds from the Concurrent
Financing (reduced in connection with subscriptions by certain
strategic, institutional and retail investors, and by insiders of
Blue Moon and shareholders of Nussir and NSG), 50% of which has
been placed in escrow (the "Escrowed Commission") as
described below.
The proceeds of the Concurrent Financing, other
than those proceeds allocated to the Unit Shares, and the Escrowed
Commission (the "Escrowed Proceeds"), will be held in escrow
pending satisfaction of the Escrow Release Conditions. Provided
that the Escrow Release Conditions are satisfied or waived (where
permitted) prior to 5:00 p.m.
(Toronto time) on February 27, 2025, or prior to April 30, 2025 if Blue Moon shareholder approval
to the Acquisitions is required by the TSXV, (the "Escrow
Release Deadline"): (i) the Escrowed Commission will be
released to the Agents from the Escrowed Proceeds, (ii) the balance
of the Escrowed Proceeds will be released to or as directed by Blue
Moon, and (iii) the Subscription Receipts shall be automatically
converted into Underlying Shares, without payment of any additional
consideration or further action on the part of the subscribers. In
the event that the Escrow Release Conditions are not satisfied by
the Escrow Release Deadline, the Escrowed Proceeds, together with
interest earned thereon, if any, will be returned to the holders of
the Subscription Receipts and such Subscription Receipts will be
cancelled.
The net proceeds from the Unit Shares will be
used for general corporate purposes and advancement of the Blue
Moon project, along with costs related to the Acquisitions. The net
proceeds from the Subscription Receipts will be primarily utilized
for exploration decline development, underground exploration, and
optimization studies at the Nussir Property, exploration permitting
at the Blue Moon Property and the NSG Property, and general
corporate purposes and working capital.
The securities issued under the first tranche of
the Concurrent Financing are subject to a statutory hold period of
four months and a day from the closing date in accordance with
applicable securities laws.
Certain insiders of the Company participated in
the Concurrent Financing and subscribed for a total of 187,000
Units for aggregate gross proceeds of C$0.56
million. Participation by the insiders in the Concurrent
Financing constitutes a related party transaction within the
meaning of Multilateral Instrument 61-101 - Protection of
Minority Security Holders in Special Transactions ("MI
61-101"). The Company has relied on the exemptions from the
valuation and minority shareholder approval requirements contained
in Sections 5.5(a) and 5.7(1)(a) of MI 61-101, on the basis that
neither the fair market value of the securities issued under the
Concurrent Financing to the insiders, nor the fair market value of
the consideration paid by the insiders, exceeded 25% of the
Company's market capitalization.
The securities referred to in this news release
have not been, nor will they be, registered under the United States
Securities Act of 1933, as amended (the "U.S. Securities
Act"), or any securities laws of any state of the United States, and may not be offered or
sold in the United States absent
registration under the U.S. Securities Act and applicable
securities laws of any state of the
United States or compliance with the requirements of an
exemption therefrom. This news release does not constitute an offer
to sell or the solicitation of an offer to buy any securities in
the United States, nor shall there
be any sale of these securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful. "United States" is
as defined in Regulation S under the U.S. Securities Act.
Strategic Investors
As part of the Concurrent Financing, the Company
welcomes several strategic investors: Hartree Partners
LP("Hartree"), Leonhard
Nilsen & Sønner AS ("LNS") and Wheaton Precious
Metals Corp. ("Wheaton," TSX: WPM, NYSE: WPM), which,
together, subscribed for over 50% of the total Units sold under the
first tranche of the Concurrent Financing.
In addition to a C$7.25
million subscription in the Concurrent Financing, Hartree
has been granted the right to subscribe for between C$5.25 million and C$7.75
million worth of Blue Moon Shares at pre-agreed conditions
based on the market price up to May 9,
2025. Hartree will also receive pro-rata pre-emptive rights
in respect of future equity issuances of Blue Moon, as long as
Hartree owns 5% of the issued and outstanding common shares of Blue
Moon, have the right to appoint a board member by the end of 2025,
and the right to participate on a technical committee. Hartree's
additional Blue Moon Share subscriptions are subject to approval of
the TSXV. The Company has also agreed to enter into a long
term offtake agreement with Hartree for Nussir concentrate
production, along with a right of last offer for a portion of the
off-take volumes at the Blue Moon and NSG projects. In addition to
the above, Hartree and Blue Moon have entered into an MOU for an up
to US$20 million secured bridge loan
facility to provide financial flexibility during construction of
the Nussir Property. Hartree and Blue Moon will continue to
advance discussions, and details will be made available should the
transaction advance and definitive terms be reached. The
facility would be subject to customary conditions precedent
including completion of due diligence, satisfactory documentation,
and final approvals by Hartree, amongst others.
Wheaton participated in the Concurrent Financing
for C$4.95 million. In addition, an
affiliate of Wheaton has acquired a corporate-wide right of first
refusal ("ROFR") on any precious metals streams on Blue
Moon's properties for C$50,000.
In addition to a C$4.2
million subscription in the Concurrent Financing, LNS has
agreed to subscribe for another C$2.2
million of Blue Moon Shares upon two milestones, the first
being the start of decline construction at the Nussir Property, and
the second 10 months after the start of decline construction. The
acquisition of these Blue Moon Shares is subject to approval of the
TSXV. Nussir has entered into a mining contract with LNS for the
Nussir Property for LNS to provide comprehensive services to the
Company during construction and operations.
Disclosure by Monial AS and Baker Steel Trust Resources
Limited
As a result of the signing of the Definitive Agreement in
respect of the acquisition of the shares of Nussir (the "Nussir
SPA"), Monial AS ("Monial"), an existing Nussir shareholder, will,
on completion of the Nussir SPA, beneficially own and control
82,922,061 Blue Moon Shares, resulting in Monial having an
ownership interest of 17.8% of the issued and outstanding shares of
Blue Moon, on closing, and assuming an aggregate fundraising by
Blue Moon of C$30,000,093. Prior to
signing the Nussir SPA, Monial did not own or control any
securities of Blue Moon. The aggregate value of the Blue Moon
Shares to be issued to Monial on closing of the Nussir SPA is
C$24,876,618 (or C$0.30 per Blue Moon Share, which is the
equivalent of NOK4.25 per Nussir
share to be purchased by Blue Moon, using the exchange rate in the
Nussir SPA of NOK1:C$0.1253). Monial entered into the Nussir
SPA to sell its Nussir shares to Blue Moon in exchange for Blue
Moon Shares and to acquire the Blue Moon Shares for investment
purposes. Depending on market conditions and other factors,
Monial may from time to time acquire and/or dispose of securities
of Blue Moon or continue to hold its current position.
To obtain a copy of the early warning report to be filed by
Monial in connection with this press release, please contact:
Halvor Holta at +47 907 21
036. Monial's address is Dicks vei 12, N-1366 Lysaker,
Norway.
As a result of the signing of the Nussir SPA, Baker Steel
Resources Trust Limited ("BSRT"), an existing Nussir shareholder,
will, on completion of the Nussir SPA, beneficially own and control
57,895,552 Blue Moon Shares, comprised of 55,728,882 Blue Moon
Shares which it will receive as consideration under the Nussir SPA
and 2,166,670 Unit Shares which it is subscribing for under the
Concurrent Financing, resulting in BSRT having an aggregate
ownership interest of 12.4% of the issued and outstanding shares of
Blue Moon, on closing, and assuming an aggregate fundraising by
Blue Moon of C$30,000,093.
Prior to signing the Nussir SPA and the closing of the Concurrent
Financing, BSRT did not own or control any securities of Blue Moon.
The aggregate value of the Blue Moon Shares and Unit Shares to be
issued to BSRT on closing of the Nussir SPA and closing of the
Concurrent Financing is C$17,368,666
(or C$0.30 per Blue Moon Share or
Unit Share, which is the equivalent of NOK4.25 per Nussir share to be purchased by Blue
Moon, using the exchange rate in the Nussir SPA of NOK1:C$0.1253).
BSRT entered into the Nussir SPA to sell its Nussir shares to Blue
Moon in exchange for Blue Moon Shares and subscribed for Units
under the Concurrent Financing for investment purposes.
Depending on market conditions and other factors, BSRT may from
time to time acquire and/or dispose of securities of Blue Moon or
continue to hold its current position.
To obtain a copy of the early warning report to be filed by BSRT
in connection with this press release, please contact: Tino Isnardi, +44 20 7389 0009. BSRT's
address is East Wing, Trafalgar Court, Les Banques, St Peter Port,
Guernsey, GY1 3PP.
About Blue Moon
Blue Moon Metals is advancing its Blue Moon
polymetallic deposit which contains zinc, gold, silver and copper.
The property is well located with existing local infrastructure
including paved highways three miles from site; a hydroelectric
power generation facility a few miles from the site, a three-hour
drive to the Oakland port and a
four-hour drive to the service center of Reno. Zinc and copper
are currently on the USGS list of metals critical to the US economy
and national security. More information is available on the
Company's website (www.bluemoonmetals.com).
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
CAUTIONARY DISCLAIMER - FORWARD LOOKING
STATEMENTS
This news release includes "forward-looking
statements" and "forward-looking information" within the meaning of
applicable Canadian and U.S. securities laws relating to, among
other things, the holdings of the existing Blue Moon, Nussir and
NSG shareholders at closing of the Acquisitions; completion of the
proposed Acquisitions and the expected timing thereof; the receipt
of final TSXV acceptance in respect of the Concurrent Financing;
the receipt of TSXV acceptance in all aspects in respect of the
Acquisitions; that no single shareholder will own 20% of Blue Moon
at closing of the Acquisitions; the publication of a maiden
preliminary economic assessment on the Blue Moon Property and the
timing thereof; the potential closing of additional tranches of the
Concurrent Financing; the satisfaction of the Escrow Release
Conditions; the conversion of the Subscription Receipts into
Underlying Shares; the conversion of the Subscription Receipts and
the anticipated timing thereof; the anticipated use of the proceeds
from the Concurrent Financing; the availability of the Hartree
Facility; the project financing package at Nussir and the timing
thereof; the ROFR; LNS' right to subscribe for additional Blue Moon
Shares; the completion of formal mining construction and operations
contracts with LNS in respect of the NSG Property and the Blue Moon
Property and the timing thereof; and the right to raise additional
funds from Hartree. Forward-looking information may in some cases
be identified by words such as "will", "anticipates", "expects",
"intends" and similar expressions suggesting future events or
future performance.
We caution that all forward-looking
information is inherently subject to change and uncertainty and
that actual results may differ materially from those expressed or
implied by the forward-looking information. A number of risks,
uncertainties and other factors could cause actual results and
events to differ materially from those expressed or implied in the
forward-looking information or could cause our current objectives,
strategies and intentions to change. Accordingly, we warn investors
to exercise caution when considering statements containing
forward-looking information and that it would be unreasonable to
rely on such statements as creating legal rights regarding our
future results or plans. We cannot guarantee that any
forward-looking information will materialize and you are cautioned
not to place undue reliance on this forward-looking information.
Any forward-looking information contained in this news release
represents expectations as of the date of this news release and are
subject to change after such date. However, we are under no
obligation (and we expressly disclaim any such obligation) to
update or alter any statements containing forward-looking
information, the factors or assumptions underlying them, whether as
a result of new information, future events or otherwise, except as
required by law. All of the forward-looking information in this
news release is qualified by the cautionary statements
herein.
Forward-looking information is provided herein
for the purpose of giving information about the Concurrent
Financing and the Acquisitions referred to herein and their
expected impact. Readers are cautioned that such information may
not be appropriate for other purposes. Completion of the
Acquisitions is subject to customary closing conditions,
termination rights and other risks and uncertainties. Accordingly,
there can be no assurance that the Acquisitions will occur, or that
they will occur on the terms and conditions contemplated in this
news release. The Acquisitions could be modified, restructured or
terminated. There can also be no assurance that the strategic
benefits expected to result from the Acquisitions will be fully
realized. In addition, if the Acquisitions are not completed, and
each of the parties continues as an independent entity, there are
risks that the announcement of the Acquisitions and the dedication
of substantial resources of each party to the completion of the
Acquisitions could have an impact on such party's current business
relationships (including with future and prospective employees,
customers, distributors, suppliers and partners) and could have a
material adverse effect on the current and future operations,
financial condition and prospects of such party.
A comprehensive discussion of other risks that
impact Blue Moon can also be found in its public reports and
filings which are available at www.sedarplus.ca.
SOURCE Blue Moon Metals Inc.
