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ALP.V News Today.
Alabama Graphite signs six NDAs for CSPG samples


2016-07-18 14:27 ET - News Release



Mr. Donald Baxter reports

ALABAMA GRAPHITE CORP. ANNOUNCES THE EXECUTION OF SIX NON-DISCLOSURE AGREEMENTS WITH U.S DEPARTMENT OF DEFENSE LITHIUM-ION BATTERY SOLUTION PROVIDERS FOR COATED SPHERICAL GRAPHITE (CSPG) SAMPLES

Alabama Graphite Corp. has entered into a total of six non-disclosure agreements (NDAs) with U.S. Department of Defense (DoD) lithium-ion battery manufacturers and suppliers for the purpose of carrying on discussions and due diligence evaluation of samples of AGC's American-sourced-and-manufactured coated spherical graphite (CSPG). The graphite used by AGC to produce its CSPG is sourced exclusively from the Company's flagship Coosa Graphite Project property, located in Coosa County, Alabama, USA. All six of the battery manufacturers are based in the contiguous United States. The testing by these DoD suppliers is designed to determine if AGC's CSPG would qualify for Li-ion battery applications - both for primary and secondary Li-ion batteries - specifically for DoD use. The names of the six DoD battery manufacturers are being withheld for reasons of commercial confidentiality. These six NDA agreements are in addition to the multiple NDA agreements AGC has entered into with U.S.-based entities that are not affiliated with the U.S. DoD.

Further to the Company's June 23, 2016 announcement (see: "Alabama Graphite Corp. Announces Shipment of American Sourced and Manufactured CSPG Samples to United States Department of Defense Lithium-ion Battery Solutions Provider" ), AGC will be manufacturing CSPG evaluation samples to the material specifications provided from the various battery manufacturers. The DoD strongly encourages their contractors and suppliers to source their input materials from within the USA. As a result, several of these DoD battery manufacturers have sought out AGC as a potential future supplier of American sourced and manufactured CSPG.

Donald Baxter, AGC's President, Chief Executive Officer and Executive Director commented, "Without exception, all of the DoD contractors and suppliers we have entered into NDAs with have expressed that sourcing input materials from within the United States is more important than ever. AGC is focussed on becoming a U.S.-sourced green-energy supply chain producer for the United States government and defense sectors' battery solutions providers." Mr. Baxter added, "Although there is much work to be done, pending the initiation and completion of a positive Feasibility Study, followed by the financing and construction of a graphite mine and downstream CSPG processing and production facilities, I believe that AGC will be a viable domestic upstream supply option for these and other American lithium-ion battery manufacturing entities."

At this time, no further deal terms have been reached, nor has the Company entered into any letters of intent, offtake agreements, supply or customer agreements or any other form of definitive agreements with these battery manufacturers. As the Company's discussions remain at a preliminary stage only, there can be no assurance or guarantee that the Company will enter into a binding agreement.

Note: AGC completed its Preliminary Economic Assessment ("PEA") for the Coosa Graphite Project on November 27, 2015. A PEA is not a Feasibility Study. The PEA is preliminary in nature, that it includes Inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA based on these mineral resources will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

Additionally, the Company announces that, subject to regulatory approval, it has retained Venture Liquidity Providers Inc. ("VLP") to initiate its market-making service to provide assistance in maintaining an orderly trading market for the common shares of the Company.

According to the TSX Venture Exchange, "Market making offers several benefits to growing companies during their formative years. Having a committed market maker can promote market stability when there are gaps in natural liquidity, help to mitigate price volatility, and enhance the trading experience for investors. In fact, based on recent analysis by TSXV conducted between January 1, 2014 and August 2015, companies that engaged professional market maker services experienced a $0.02 decline in their average spread, an 18% increase in the number of days when a trade occurred, and a 6% decline in price volatility measured by the closing price against the 10-day moving average price." (source: TSX Venture Exchange's Exchange Feed, Issue 52, July 2016)

The market-making service will be undertaken by VLP through a registered broker, W.D. Latimer Co. Ltd. ("W.D. Latimer"), in compliance with the applicable policies of the TSX Venture Exchange and other applicable legislation. For its services the Company has agreed to pay VLP $5,000. per month. The engagement is for a period of 12 months, but can be terminated by either party at any time. The Company and VLP act at arm's length, and VLP has no present interest - directly or indirectly - in the Company or its securities. The finances and the shares required for the market-making service are provided by W.D. Latimer. The fee paid by the Company to VLP is for services only.

VLP is a specialized consulting firm based in Toronto providing a variety of services focused on TSX-V-listed issuers.

AGC will continue to update shareholders and the market in a timely fashion of further material developments with respect to this and other potential American-based CSPG end users, as we are able to disclose. Please note, certain potential end users preclude the Company from announcing any aspect of its relationship and activities, ranging from the execution of a non-disclosure agreement to the shipment(s) of sample material.

Qualified Person

Donald K. D. Baxter, P.Eng., President, Chief Executive Officer and Executive Director of Alabama Graphite Corp., is a Qualified Person as defined by National Instrument 43-101 ("NI 43-101") guidelines, and has reviewed and approved the content of this news release.


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