REG - Atlantic Lithium Ltd - A$9 million Equity Placing

Atlantic LithiumAnnouncement

24/10/2024 16:45

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RNS Number : 5339J  Atlantic Lithium Limited  24 October 2024

24 October 2024

A$9 million Equity Placing

to contribute to the funding of the Ewoyaa Lithium Project

Atlantic Lithium Limited (AIM: ALL, ASX: A11, GSE: ALLGH, OTCQX: ALLIF,
"Atlantic Lithium" or the "Company"), the Africa-focused lithium exploration
and development company targeting the delivery of Ghana's first lithium mine,
is pleased to announce the launch of an institutional placement ("Equity
Placing") of new fully paid ordinary shares of no par value each in the
Company ("New Shares") at an offer price of A$0.23 (equivalent to 11.73 pence)
per New Share ("Issue Price").

Highlights of the Equity Placing

-       The Equity Placing will be undertaken by an institutional
placement utilising the Company's existing share authorities, launching today,
to raise a minimum of A$9.0 million (£4.6 million/US$6.0 million). As part of
the Equity Placing, the Company reserves the ability to accept
oversubscriptions for up to A$3.0 million (£1.5 million/US$2.0 million).

 

-       As part of the Equity Placing, the Company has received a signed
commitment letter from Assore International Holdings Limited ("Assore"), the
Company's largest shareholder, to invest up to US$5 million (A$7.5
million/£3.9 million) through the purchase of up to 32,608,695 New Shares at
the Issue Price (the "Assore Participation").

 

-       In addition, Executive Chairman Neil Herbert, Chief Executive
Officer Keith Muller, and Non-executive Director Edward Koranteng, all
Directors of the Company (the "Directors"), have provided an indication to
invest up to A$290,000 in aggregate in the Equity Placing (the "Director
Participation"). The Assore Participation and Director Participation are
conditional on shareholder approval at the Company's upcoming Annual General
Meeting ("AGM").

 

-       Net proceeds from the Equity Placing will be used to contribute
to funding the Company's flagship Ewoyaa Lithium Project ("Ewoyaa" or the
"Project") in Ghana towards the Project Final Investment Decision ("Project
FID") and working capital requirements.

 

-       The Equity Placing will be undertaken at a fixed issue price of
A$0.23 (equivalent to 11.73 pence) per New Share, which represents a 11.5%
discount to the last closing price of A$0.26 on 24 October 2024 on the ASX.

 

-       Canaccord Genuity (Australia) Limited has been appointed as Lead
Manager ("Lead Manager") in connection with the Equity Placing. Wilsons
Advisory & Stockbroking is acting as Co-Manager ("Co-Manager").

 

Proposed Use of Proceeds

-       Project Expenditure

·      Optimisation and technical refinement of the Ewoyaa Definitive
Feasibility Study ("DFS");

·      Expenditure related to advancing the Project through the
remaining permitting activities to Project FID;

·      Operational activities to achieve shovel readiness, including
site preparation, relevant health and safety reports, the establishment of the
Community Development Fund and the implementation of measures to manage and
monitor Project impacts.

 

-       Exploration

·      Exploration of the highly prospective Rubino and Agboville
licences in Côte d'Ivoire, as required under the terms of the licences.

 

-       Working capital

·      General working capital requirements.

 

Commenting, Neil Herbert, Executive Chairman of Atlantic Lithium, said:

"With significant recent progress made at Ewoyaa, despite having been impacted
by the delay in the parliamentary ratification of the Mining Lease, this
institutional Equity Placing will see the Company funded to advance the
Project towards FID and shovel-readiness.

"Funds will be allocated towards the optimisation of the Ewoyaa DFS, the
advancement of the Project through the key permitting and operational
activities before we can break ground at the Project.

"We warmly welcome Assore's commitment to participate in the Equity Placing.
As a cornerstone investor in Atlantic Lithium since its AIM listing, Assore's
participation further underscores its belief in the Company achieving its goal
of delivering spodumene concentrate production at Ewoyaa.

"Alongside CEO Keith Muller and Non-executive Director Edward Koranteng, I am
proud to also be participating in the Equity Placing. As Directors, we believe
in the importance of putting our money where our mouth is. We have done so on
many occasions to date and, at such a pivotal moment for the Project, we are
proud to take the opportunity to extend our belief in the Company's
ambitions.

"We look forward to the completion of the Equity Placing, which will
facilitate our next steps towards delivering Ghana's first lithium mine."

 

Background to the Equity Placing

On 29 June 2023, the Company published a Definitive Feasibility Study for the
Ewoyaa Lithium Project ("DFS") which highlighted economic outcomes placing the
Project as an industry-leading asset with a steady state production rate of
365,000 tonnes per annum ("ktpa") over a 12-year Life of Mine(1) and an All-in
Sustaining Cost of US$675/tonne.

The total development expenditure for the Project indicated by the DFS is
estimated to be US$185 million, of which the Company's partner, Piedmont
Lithium, will sole fund the initial US$70 million, and 50% thereafter. As
previously disclosed, the Minerals Income Investment Fund ("MIIF") and the
Company have agreed non-binding Heads of Terms for MIIF's planned total
US$32.9 million Strategic Investment in the Company and its Ghanaian
subsidiaries. Following the completion of MIIF's US$5 million subscription in
the Company in January 2024, which constitutes Stage 1 of MIIF's Strategic
Investment, the Company is currently in the process of completing Stage 2,
comprising MIIF's US$27.9m Project-level investment for a 6% contributing
interest in the Project. In parallel, the Company has progressed the ongoing
competitive offtake partnering process to secure funding to sufficiently cover
the Company's allocation of development expenditure for the Project.

The Company has made material progress towards reaching a Final Investment
Decision. The following key milestones were achieved during 2024:

o  Granted a Mine Operating Permit in respect of the Project, representing
the final regulatory approval required prior to commencing construction of the
Project.

o  Issued a Land Use Certificate, detailing the approval of the land
contained within the Project's Mining Area to be rezoned for mining purposes,
as required prior to commencing construction and mining activities.

o  Environmental Protection Agency ("EPA") environmental permit granted in
respect of the Project.

o  Ewoyaa Mining Lease submitted to Ghana's parliament to undergo the
ratification process in order for parliament to ratify the Mining Lease.

o  Completion of the Front-End Engineering Design ("FEED") package for the
Project, undertaken with DRA Projects.

 

The Company is currently undertaking an optimisation and technical refinement
of the Ewoyaa DFS whilst advancing the Project through the remaining
permitting steps to Project FID. Operational activities are underway to
achieve shovel-readiness and meet the requirements of the Project permits and
the implementation of measures to manage and monitor Project impacts.

Advisers

Canaccord Genuity (Australia) Limited is acting as Lead Manager to the Equity
Placement. Wilsons Advisory & Stockbroking is acting as Co-Manager.

Expected Timetable of Principal Events

The times and dates set out below are subject to change and may be adjusted by
the Company in consultation with the Lead Manager. In the event of any
significant changes from the below expected timetable, details of the new
times and dates will be notified to Company shareholders by an announcement on
a Regulatory Information Service.

                                                                               AIM                           ASX                           GSE
 Announcement of the Equity Placing and (on ASX only) Trading Halt             24 October 2024               25 October 2024               24 October 2024
 Announcement of the results of the Equity Placing                             25 October 2024               25 October 2024               25 October 2024
 Trading Halt lifted and shares recommence trading on ASX                       -                            25 October 2024                -
 Allotment and trading of new securities under the placement (Tranche 1)       30 October 2024               30 October 2024                -
 Allotment and trading of new securities to Assore and Directors, conditional  On or around 6 December 2024  On or around 6 December 2024  -
 on shareholder approval (Tranche 2)

The timetable is indicative only and subject to modification at Atlantic
Lithium's discretion.

Allotment and trading

Allotment for New Shares (on ASX and AIM) will take place in two tranches:

·      Tranche 1 will be the unconditional allotment of New Shares to
all investors excluding Assore and the Directors ("Tranche 1 Shares");
admission to trading on the ASX and AIM is expected to take place on or around
30 October 2024.

·      Tranche 2 will be the allotment of New Shares to Assore and the
Directors, which is conditional on shareholder approval at the upcoming AGM
("Tranche 2 Shares"); admission to trading on the ASX and AIM is expected to
take place on or around 6 December 2024.

 

All New Shares will be issued fully paid and will rank pari passu in all
respects with the Company's existing Ordinary Shares, including the right to
receive all dividends and other distributions declared, made or paid after the
date of issue.

An application will be made to the GSE for admission to trading of the Tranche
1 and Tranche 2 Shares in due course.

Related Party Transactions

The proposed Assore Participation and the Director Participation will
constitute related party transactions under AIM Rule 13 of the AIM Rules for
Companies.

For ASX Listing Rule 10.11 purposes, the proposed Assore Participation and the
Director Participation is conditional on shareholder approval to be sought at
the upcoming AGM.

Additional Information

The content of this announcement has not been approved by an authorised person
within the meaning of the Financial Services and Markets Act 2000, as amended
("FSMA"). Reliance on this announcement for the purpose of engaging in any
investment activity may expose an individual to a significant risk of losing
all of the property or other assets invested. The price of shares and any
income expected from them may go down as well as up and investors may not get
back the full amount invested upon disposal of the shares. Past performance is
no guide to future performance, and persons needing advice should consult an
appropriate independent financial adviser.

Nothing contained in this announcement constitutes investment, legal, tax or
other advice. You should seek appropriate professional advice before making
any investment decision.

No representation or warranty, express or implied, is or will be made as to,
or in relation to, and no responsibility or liability is or will be accepted
by the Company, the Lead Manager, or by any of their affiliates or agents as
to, or in relation to, the accuracy or completeness of this announcement or
any other written or oral information made available to or publicly available
to any interested party or its advisers, and any liability therefore is
expressly disclaimed.

No statement in this announcement is intended to be a profit forecast or
estimate, and no statement in this announcement should be interpreted to mean
that earnings per share of the Company for the current or future financial
years would necessarily match or exceed the historical published earnings per
share of the Company.

The New Shares to be issued pursuant to the Placing will not be admitted to
trading on any stock exchange other than the ASX, AIM and the GSE.

Neither the content of the Company's website nor any website accessible by
hyperlinks on the Company's website is incorporated in, or forms part of, this
announcement.

Exchange Rates

The exchange rates used in the announcement are as follows (as at 23 October
2024):

·    AUD - USD: 0.67

·    AUD - GBP: 0.51

·    USD - GBP: 0.77

Disclaimer

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under Article 7 of the market
abuse regulation (EU) no. 596/2014 as it forms part of UK domestic law
pursuant to the European Union (withdrawal) Act 2018, as amended. Upon the
publication of this announcement via a regulatory information service, this
information is considered to be in the public domain. The person responsible
for releasing this announcement is Amanda Harsas.

This announcement and the information contained herein, is restricted and is
not for publication, release or distribution, directly or indirectly, in whole
or in part, in or into the United States, Canada, Japan, the Republic of South
Africa or New Zealand or any other jurisdiction in which it would be unlawful
to do so.

This announcement is for information purposes only and does not itself
constitute an offer for sale or subscription of any securities in the
Company.  This announcement does not constitute or contain any invitation,
solicitation, recommendation, offer or advice to any person to subscribe for,
otherwise acquire or dispose of any securities of Atlantic Lithium Limited in
any jurisdiction in which any such offer or solicitation would be unlawful.

Cautionary Statement about Forward-Looking Statements

This announcement contains certain "forward-looking statements" including
statements regarding our intent, belief, or current expectations with respect
to Atlantic Lithium's business and operations, market conditions, results of
operations and financial condition, and risk management practices. The words
"likely", "expect", "aim", "should", "could", "may", "anticipate", "predict",
"believe", "plan", "forecast" and other similar expressions are intended to
identify forward-looking statements. Indications of, and guidance on, future
earnings, anticipated production, life of mine and financial position and
performance are also forward-looking statements. These forward-looking
statements involve known and unknown risks, uncertainties and other factors
that may cause Atlantic Lithium's actual results, performance and achievements
or industry results to differ materially from any future results, performance
or achievements, or industry results, expressed or implied by these
forward-looking statements. Relevant factors may include (but are not limited
to) changes in commodity prices, foreign exchange fluctuations and general
economic conditions, increased costs and demand for production inputs, the
speculative nature of exploration and project development, including the risks
of obtaining necessary licences and permits and diminishing quantities or
grades of reserves, political and social risks, changes to the regulatory
framework within which Atlantic Lithium operates or may in the future operate,
environmental conditions including extreme weather conditions, recruitment and
retention of personnel, industrial relations issues and litigation.

Forward-looking statements are based on Atlantic Lithium's good faith
assumptions as to the financial, market, regulatory and other relevant
environments that will exist and affect Atlantic Lithium's business and
operations in the future. Atlantic Lithium does not give any assurance that
the assumptions will prove to be correct. There may be other factors that
could cause actual results or events not to be as anticipated, and many events
are beyond the reasonable control of Atlantic Lithium. Readers are cautioned
not to place undue reliance on forward-looking statements, particularly in the
current economic climate with the significant volatility, uncertainty and
disruption. Forward-looking statements in this document speak only at the date
of issue. Except as required by applicable laws or regulations, Atlantic
Lithium does not undertake any obligation to publicly update or revise any of
the forward-looking statements or to advise of any change in assumptions on
which any such statement is based. Except for statutory liability which cannot
be excluded, each of Atlantic Lithium, its officers, employees and advisors
expressly disclaim any responsibility for the accuracy or completeness of the
material contained in these forward-looking statements and excludes all
liability whatsoever (including in negligence) for any loss or damage which
may be suffered by any person as a consequence of any information in
forward-looking statements or any error or omission.

Overseas Investors

The New Shares have not been and will not be registered under the U.S.
Securities Act of 1933, as amended (the "Securities Act" or with any
securities regulatory authority of any state or other jurisdiction of the
United States and may not be offered, sold, pledged, taken up, exercised,
resold, renounced, transferred or delivered, directly or indirectly, in or
into the United States absent registration under the Securities Act, except
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and in compliance with any
applicable securities laws of any state or other jurisdiction of the United
States. The Placing Shares not been approved, disapproved or recommended by
the U.S. Securities and Exchange Commission, any state securities commission
in the United States or any other U.S. regulatory authority, nor have any of
the foregoing authorities passed upon or endorsed the merits of the offering
of the Placing Shares. Subject to certain exceptions, the securities referred
to herein may not be offered or sold in the United States, Canada, Japan, New
Zealand, the Republic of South Africa or to, or for the account or benefit of,
any national, resident or citizen of the United States, Canada, Japan, New
Zealand or the Republic of South Africa.

The relevant clearances have not been, nor will they be, obtained from the
securities commission of any province or territory of Canada; no prospectus
has been lodged with, or registered by, the Financial Markets Authority of New
Zealand or the Japanese Ministry of Finance; the relevant clearances have not
been, and will not be, obtained from the South Africa Reserve Bank or any
other applicable body in the Republic of South Africa in relation to the New
Shares; and the New Shares have not been, and nor will they be, registered
under or offered in compliance with the securities laws of any state, province
or territory of Canada, Japan, New Zealand or the Republic of South Africa.
Accordingly, the New Shares may not (unless an exemption under the relevant
securities laws is applicable) be offered, sold, resold or delivered, directly
or indirectly, in or into Canada, Japan, New Zealand or the Republic of South
Africa or any other jurisdiction outside the United Kingdom or to, or for the
account or benefit of any national, resident or citizen of Japan, New Zealand
or the Republic of South Africa or to any investor located or resident in
Canada.

No Public Offer or Prospectus

No public offering of the New Shares is being made in the United States,
Australia, the United Kingdom or elsewhere. This announcement is for
information purposes and is not a prospectus, product disclosure statement or
any other offering document under Australian law or the law of any other
jurisdiction (and will not be lodged with the Australian Securities and
Investments Commission ("ASIC") or any foreign regulator).

All offers of the New Shares will be made in the European Economic Area or the
United Kingdom pursuant to an exemption from the requirement to produce a
prospectus under Regulation (EU) 2017/1129 of the European Parliament and
Council of 14 June 2017 and any relevant implementing measures in any Member
State of the European Economic Area (the "EU Prospectus Regulation"), or
pursuant to the UK version of the EU Prospectus Regulation, which is part of
UK law by virtue of the European Union (Withdrawal) Act 2018, as amended (the
"UK Prospectus Regulation") (as the case may be).

No prospectus will be made available in connection with the matters contained
in this announcement and no such prospectus is required (in accordance with
the EU Prospectus Regulation or the UK Prospectus Regulation, as the case may
be) to be published.

This announcement is being distributed to persons in the United Kingdom only
in circumstances in which section 21(1) of the FSMA does not apply.

This announcement is for information purposes only and is directed only at
persons who are: (a) persons in Australia to whom an offer of securities may
be made without a disclosure document (as defined in the Australian
Corporations Act 2001 (Cth) ("Corporations Act") on the basis that such
persons are exempt from the disclosure requirements of Part 6D.2 in accordance
with Section 708(8) or 708(11) of the Corporations Act; (b) persons in Member
States (of the European Economic Area) who are Qualified Investors (as defined
in the EU Prospectus Regulation); and (c) in the United Kingdom, Qualified
Investors (as defined in the UK Prospectus Regulation) who are persons who (i)
have professional experience in matters relating to investments falling within
the definition of "investment professionals" in article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended
(the "Order"); (ii) are persons falling within article 49(2)(a) to (d) ("high
net worth companies, unincorporated associations, etc") of the Order; or (iii)
are persons to whom it may otherwise be lawfully communicated; (all such
persons together being referred to as relevant persons").

This announcement must not be acted on or relied on by persons who are not
relevant persons. Persons distributing this announcement must satisfy
themselves that it is lawful to do so. Any investment or investment activity
to which this announcement is available only to relevant persons and will be
engaged in only with relevant persons.

End Note

(1) Ore Reserves, Mineral Resources and Production Targets

The information in this announcement that relates to Exploration Results, Ore
Reserves, Mineral Resources and Production Targets complies with the 2012
Edition of the Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves (JORC Code). The information in this announcement
relating to Production Targets in respect of the Ewoyaa Lithium Project is
extracted from the Company's announcement entitled "Ewoyaa Lithium Project
Definitive Feasibility Study", dated 29 June 2023, which is available at
www.atlanticlithium.com.au (http://www.atlanticlithium.com.au) . The Company
confirms, in the case of Production Targets, that all technical parameters
underpinning the Definitive Feasibility Study ("DFS") continue to apply.
Material assumptions for the Project have been revised on grant of the Mining
Lease for the Project, announced by the Company on 20 October 2023 in the
announcement entitled, "Mining Lease Granted for Ewoyaa Lithium Project". The
Company is not aware of any new information or data that materially affects
the information included in this announcement, the "Ewoyaa Lithium Project
Definitive Feasibility Study" announcement, dated 29 June 2023, or the "Mining
Lease Granted for Ewoyaa Lithium Project" announcement, dated 20 October 2023.

 

Authorised for release by Amanda Harsas, Finance Director and Company
Secretary, Atlantic Lithium Limited.

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.

 

For any further information, please contact:
Atlantic Lithium Limited

Neil Herbert (Executive Chairman)

Amanda Harsas (Finance Director and Company Secretary)

                   www.atlanticlithium.com.au (http://www.atlanticlithium.com.au)
                   IR@atlanticlithium.com.au
                   Tel: +61 2 8072 0640
 SP Angel Corporate Finance LLP      Yellow Jersey PR Limited                                           Canaccord Genuity Limited

 Nominated Adviser                   Charles Goodwin                                                    Financial Adviser:

 Jeff Keating                        Bessie Elliot                                                      Raj Khatri (UK) /

                                   atlantic@yellowjerseypr.com (mailto:atlantic@yellowjerseypr.com)

 Charlie Bouverat
                                                                  Duncan St John, Christian Calabrese (Australia)

                                   Tel: +44 (0)20 3004 9512

 Tel: +44 (0)20 3470 0470

                                                                                                        Corporate Broking:

                                                                                                        James Asensio

                                                                                                        Tel: +44 (0) 20 7523 4500

Notes to Editors:

 

About Atlantic Lithium

www.atlanticlithium.com.au (http://www.atlanticlithium.com.au/)

Atlantic Lithium is an AIM, ASX, GSE and OTCQX-listed lithium company
advancing its flagship project, the Ewoyaa Lithium Project, a significant
lithium spodumene pegmatite discovery in Ghana, through to production to
become the country's first lithium-producing mine.

The Definitive Feasibility Study for the Project indicates the production of
3.6Mt of spodumene concentrate over a 12-year mine life, making it one of the
largest spodumene concentrate mines in the world.

The Project, which was awarded a Mining Lease in October 2023, is being
developed under an earn-in agreement with Piedmont Lithium Inc.

Atlantic Lithium holds a portfolio of lithium projects within 509km(2) and
771km(2) of granted and under-application tenure across Ghana and Côte
d'Ivoire respectively, which, in addition to the Project, comprises
significantly under-explored, highly prospective licences.

 

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