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Good point. I will update my chart to reflect the added income. Should be a big difference.
By the way you can buy gxiiw warrants now for around .20
They have gone up from a dime.
The chart doesn't show any dilution from Yorkville. The $81 million is on standby but uncertain of its use.
Also if there are redemptions by gxii the numbers will be off.
The what if scenarios involve the class B earnout shares where Niobf must reach $1.2 and the other portion must reach $1.5 to be transferred to the founders. And of course the warrants only have intrinsic value above $1.03
What I like about the chart I posted is it is just math.
It simply shows:
1. each class of gxii stock in the merger.
2. how many shares could be exchanged
3. Niobf/gxii ownership %
4. And lastly the cost per share, if $285 million is received which is a cumulative number. For example if all shares and warrants are exchanged gxii will be getting on average Niobf at .48
Yes. The warrants were issued in 2021 with the gxii ipo. The ipo had 30,000,000 class A shares, and so they issued to those in the ipo 10,000,000 warrants. They also sold to the founders 5,666,667 full warrants so gxii has a total of 15,666,667 warrants exercisable at 11.50
When exercised
15,666,667 x 11.1829212
Gives 175,199,103 Niobf shares exercisable at
$11.50 / 11.1829212
Gives a price $1.03
NOTE 3. INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company sold 30,000,000 Units at a purchase price of $10.00 per Unit. Each Unit consists of one share of the Company’s Class A common stock, $0.0001 par value, and one-third of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at an exercise price of $11.50 per share (see Note 9).
not working
Not working
I gave a very real example. It should make you angry, at Mark.
You don't get it. SPACs love to redeem their shares to get their money back. They still get to keep their warrants which were free. In other words they have no risk.
If you are getting warrants that exercise into 175 million niobf shares you don't need to put in anything else, and if you look up the history of SPACs that is exactly what they are doing.
The minimum requirement for the deal to go through is at least $15 million of gxii shares submitted for merger.
"The consummation of the Transaction is subject to the satisfaction...
at Closing, NioCorp and its subsidiaries (including GXII, as the surviving company of the Second Merger) will have received cash in an amount equal to or greater than $15,000,000 in connection with the Transaction"
I have concluded that Mark made a bad deal for existing shareholders.
But it can get even worse. On average half the shares in spac mergers choose to redeem instead.
If half of gxii class A shares (15,000,000 shares) are
redeemed that leaves niocorp only half the cash or $142,500,000
15,000,000 class A shares
7,500,000 class B shares
22,500,000 total gxii shares
22,500,000 x 11.1829212
Gives 251,615,727 new Niobf shares
So $142,500,000 / 251,615,727 gives .566 per share
And still all the free warrants. (175 mill)
Facts are facts. Niocorp is diluting the hell out of existing shareholders.
Mark negotiated away up to 68% of that. Cause for alarm.
The best answer is Mark was desperate. All the talk over the years, all the options, even with the rare earths, nobody wanted a deal but a spac running out of time.
That is a valid point that makes sense. It is better to think of the future possibilities rather than support Mark's fake numbers as some do.
The video is accurate. The reason niocorp is paying $375,000,000 in Niobf stock for only $285,000,000 cash is because of what the video points out is the "sponsor promote". The sponsor gets 20% of the deal for free. It's good to be the sponsor.
Mark is also deceptive during his interviews when he misleads retail investors by not telling them about all the GXII warrants that will be exchanged in this SPAC merger. There will be 175,000,000 additional niobf shares issued if all the GXII warrants are exercised.
(15,666,667 warrants x 11.1829212 exchange ratio = 175,199,103 new niobf shares)
If GXII exchanges all their commons (37,500,000) and warrants (15,666,667) their average price for each niobf share is at .49
Walterc your information is incorrect. Mark Smith has carefully worded his remarks to try to hide the truth from retail investors.
GXII values the common shares in its SPAC at $375,000,000
(37,500,000 OS x $10 apiece)
If all shares are merged Niocorp only receives $285,000,000
So you can easily see Niocorp is paying $375,000,000 in NIOBF shares to receive the $285,000,000 cash.
(37,500,000 OS x 11.1829212 exchange ratio = 419,359,545 new shares)
( 419,359,545 shares x .894 = $375,000,000)
So Niocorp is actually exchanging shares at .68 each
About the exchange ratio
The approximately U.S.$0.89 per NioCorp share equity rollover value represents an approximately 14% and approximately 12.6% premium to NioCorp's common share spot price and 20-day volume-weighted average common share price, respectively, as of September 23, 2022
At the closing of the Transaction, GXII shareholders will receive NioCorp common shares based on a fixed exchange ratio of 11.1829212 (the "Exchange Ratio")
11.1829212 X 0.894 usd is 10 usd and 10 usd is the share price of GXII
There are "several" problems with spacs beginning with dilution. The founders shares cost them less than a penny and someone eventually has to pay for that.
And another problem is if a majority of people in gxii choose to redeem their shares rather than merge with niocorp.
The mean redemption rate is 54.2% from 2010 through 2021. Then we only get half the cash.
Why would they do that? They redeem so often to get their money out and keep their free warrants.
For gxii they will exchange 15.6 million free warrants into Niobf warrants and eventually exercise into 175 million shares.
Now if Niobf only gets half the cash then Yorkville will step up to buy discounted shares to dump on retail.
81 million from Yorkville, there is your anchor investor.
Not exactly, here is the quote
"and that is a large part of the cash financing that we'll need and then we'll couple the rest up with debt"
Reference:
With GX2
"There could be upwards of 285 million dollars at our disposal"
$81 million convertible debt/stock equity purchase agreement
Yes. I like the project and I like your enthusiasm. But do you like the 5 years of slow motion financing always imminent but never at hand? Or the 2 weeks in June for impending results only to find on July 2nd a confidentiality agreement with gxii. I prefer candid speech from the CEO as we all should expect.
If something goes wrong, Niobf or gxii vote down the merger, or gxii redemptions are at a high level, or the markets continue to tank etc etc etc then Niobf stock price is at risk but gxii holders have none.
That is not true. Gxii shareholders have redemption rights of $10 each plus accrued interest. Their $300 million is sitting in a trust account.
The sponsors are the ones who lose if unable to complete a business combination.
Jay and Dean, hedge fund billionaires, know how to strip equity. They got the same deal as below.
https://www.thestreet.com/investing/biggest-risks-of-investing-in-spacs
One feature of the way that some SPACs go about rewarding their sponsors for putting a deal together is known as the "Sponsor Promote." This allows the dealmaker to purchase what’s usually a 20% equity stake in the resulting company for just $25K.
How lucrative can this feature be for the sponsor? Think about it. Basically, for a minimal investment, this incentive could be worth millions and millions of dollars that’s all dilutive to the aggregate equity stake of existing investors. Not just that, but the Sponsor Promote can encourage these dealmakers to inflate the value of the targeted private company in order to boost their own payout, thus leading the SPAC into an undesirable acquisition. Moreover, even if the merged company quickly flops, that 20% stake still looks pretty attractive, given the small investment required.
As I posted earlier, buying gxii you can't lose.
"Gxii is the better play.
There is no downside!
If you buy gxii at $10 and Niobf goes down considerably, say 30% instead of taking Niobf shares redeem your shares from gxii and receive back your investment and then go back and buy Niobf on the open market.
But if Niobf goes way up hold on to your gxii until March and receive locked in price of .89 "
There will likely not be any other deals. See below in red.
5.2????????????? Alternative Acquisitions; Business Combination Proposals.
(a)??????????????? The Company will, and will cause the Company Subsidiaries and its and their respective Representatives to immediately cease and terminate, and cause to be terminated, any solicitation, encouragement, discussions, negotiations or other activities with any Person or group (other than GX and its Representatives) that may be ongoing relating to any offer, proposal, expression of interest or inquiry that constitutes, or would reasonably be expected to result in, an Alternative Acquisition (an “Acquisition Proposal”). With respect to any Person or group with whom such discussions or negotiations have been terminated, the Company will, (i)?immediately discontinue access to, and disclosure of, all information regarding the Company or any Company Subsidiaries, including any data room and any confidential information, properties, facilities and books and records of the Company or any Company Subsidiary, and (ii)?within two Business Days of the execution of this Agreement, request and exercise all rights it has to require that such Person or group promptly return or destroy in accordance with the terms of the applicable confidentiality agreement all information furnished by or on behalf of the Company or any of its Affiliates and use reasonable best efforts to enforce compliance with such request, to the extent the Company has such rights under applicable agreements. The Company represents and warrants that it has not waived any confidentiality, standstill, non-disclosure, non-solicitation or similar agreement, restriction or covenant to which the Company or any Company Subsidiary is a party. The Company also covenants, agrees and confirms that (A) the Company shall take all necessary action to enforce each confidentiality, standstill, non-disclosure, non-solicitation or similar agreement, restriction or covenant to which the Company or any Company Subsidiary is a party or may hereafter become a party in accordance with Section 5.2(c), and (B) neither the Company, nor any Company Subsidiary nor any of their respective Representatives have released or will, without the prior written consent of GX (which may be withheld or delayed in GX’s sole and absolute discretion), release any Person from, or waive, amend, suspend or otherwise modify, such Person’s obligations respecting the Company or any Company Subsidiary under any confidentiality, standstill, non-disclosure, non-solicitation or similar agreement, restriction or covenant to which the Corporation or any Subsidiary is a party (provided that the foregoing will not apply to any commercial contract unrelated to an Alternative Transaction, where such confidentiality or non-solicitation restrictions are incidental thereto).
(b)?????????????? During the period from the execution of this Agreement until the Closing Date (or earlier termination of this Agreement in accordance with its terms) (the “Interim Period”), the Company will not, and will cause the Company Subsidiaries and its and their respective Representatives not to, directly or indirectly, (i)?initiate, solicit, assist, encourage or otherwise facilitate any inquiries or requests for information with respect to or the making of any inquiry regarding, or any proposal or offer that constitutes, or would reasonably be expected to result in, an Acquisition Proposal, (ii)?engage in, enter into, continue or otherwise participate in any discussions or negotiations with any Person (other than GX and its Representatives) with respect to, or provide access to its properties, books and records or any non-public information or data
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concerning the Company or any of its Affiliates to any Person (other than GX and its Representatives) relating to, any proposal or offer that constitutes, or would reasonably be expected to result in, an Acquisition Proposal (for avoidance of doubt, it being understood that the foregoing will not prohibit the Company or its Representatives from making such Person aware of the restrictions of Section?5.2(a)-(f) (the “Section?5.2 Company Provisions”) in response to the receipt of an Acquisition Proposal), (iii)?approve, endorse or recommend, or propose publicly to approve, endorse or recommend, any Alternative Proposal, (iv)?execute or enter into any letter of intent, memorandum of understanding, agreement in principle, confidentiality agreement (other than an Acceptable Confidentiality Agreement executed in accordance with Section 5.2(c)), acquisition agreement, merger agreement or similar agreement relating to an Acquisition Proposal (in each case, whether or not legally binding) or (v) resolve or agree to do any of the foregoing.
(c)??????????????? Notwithstanding anything in this Agreement to the contrary, if at any time prior to obtaining the Company Shareholder Approval, the Company Board receives a bona fide written Acquisition Proposal that did not result from a breach of this Agreement (including as a result of actions taken by any Representative of the Company that would have constituted a breach of the Section 5.2 Company Provisions if such actions had been taken by the Company) and the Company Board determines in good faith (after consultation with its outside financial advisors and outside legal counsel) that such Acquisition Proposal constitutes or would reasonably be expected to constitute a Superior Proposal, subject to the Company having been, and continuing to be in compliance with the Section 5.2 Company Provisions, the Company and its Representatives may (i)?furnish information with respect to the Company and its Subsidiaries to the Person (or group of Persons) making such proposal (and such Person’s or group’s, as the case may be, Representatives) subject to having entered into an Acceptable Confidentiality Agreement, and (ii)?participate in discussions or negotiations regarding such proposal with the Person (or group of Persons) making such proposal and such Person’s or group’s, as the case may be, Representatives; provided that the Company shall provide to GX any material non-public information, documentation or data that is provided to any Person given such access that was not previously made available to GX prior to or substantially concurrently with the time it is provided to such Person (and in any event within 24 hours thereof). For purposes of this Agreement, a “Superior Proposal” means any bona fide written Acquisition Proposal made after the date hereof by any Person or group (other than GX and its Representatives) to enter into an Alternative Acquisition that (A)?did not result from a breach of the Section 5.2 Company Provisions (including as a result of actions taken by any Representative of the Company that would have constituted a breach of the Section 5.2 Company Provisions if such actions had been taken by the Company), (B)?is, based on a good faith determination of the Company Board (after consultation with its outside financial advisors and outside legal counsel), in the best interest of the Company and more favorable, from a financial point of view, to the Company than the transactions contemplated by this Agreement, taking into account all relevant factors (including any changes to this Agreement that may be proposed by GX in response to such Acquisition Proposal), (C)?is determined in good faith by the Company Board (after consultation with its outside financial advisors and outside legal counsel) to be reasonably likely to be completed in accordance with its terms without undue delay, taking into account all financial, regulatory, legal and other aspects of such Acquisition Proposal and does not present a materially greater regulatory risk as compared to the Transactions, (D) provides for 100% cash consideration (and no non-cash consideration) to be paid to Company shareholders in such transaction, at a premium of at least 17.5% per Company Common Share over the higher of (1) the 5-day VWAP of the Company’s trading price on the TSX ending on the Business Day
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45 ?
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immediately prior to entering into a definitive merger, business combination or other similar transaction agreement in respect of such Superior Proposal and (2) the publicly disclosed per Company Common Share value of the Transactions, (E) is made by a Person or group of Persons who has demonstrated to the satisfaction of the Company Board, acting in good faith (after consultation with its outside financial advisors and outside legal counsel), that it has (i) adequate cash on hand and/or (ii) fully committed financing in place at the time of execution of the definitive transaction agreement in connection with such Acquisition Proposal from a bank or other recognized and reputable financial institution, fund or organization that makes debt or equity investments or financing as part of its usual activities, and that is not subject to any condition or contingency other than customary closing conditions to complete such Acquisition Proposal at the time and on the basis set out therein, (F) is not subject to any due diligence or to any material additional closing conditions as compared to the Transactions pursuant to this Agreement; provided that, notwithstanding anything in this Agreement to the contrary, no Acquisition Proposal can be a Superior Proposal if such Acquisition Proposal is made by a third party, including a group consisting of joint actors with a third party, that (1) is a related party (as defined under Canadian securities laws) or an Affiliate of the Company, (2) is an issuer whose principal asset is cash, cash equivalents, or its exchange listing, including, without limitation, a special purpose acquisition company (other than GX), (3) has been approached by either GX or the Company, with the consent of the other Party, or (4) has been approached by the Company in connection with the Transaction prior to the receipt by the Company of such Superior Proposal; provided, further, that for purposes of the definition of “Superior Proposal,” the term “Acquisition Proposal” shall have the meaning assigned to such term herein, except that (x) the references to “15% or more” in such definition shall be deemed to be references to “100%” and (y) the references to “assets of the Company and its Subsidiaries which constitute 15% or more of the consolidated net revenues, net income or assets of the Company and its Subsidiaries, taken as a whole” shall be deemed to be references to “all or substantially all of the assets of the Company and its Subsidiaries, taken as a whole”. For purposes of this Agreement, an “Acceptable Confidentiality Agreement” means a confidentiality agreement that contains confidentiality and standstill provisions on terms no less favorable in any substantive respect to the Company than those contained in the Confidentiality Agreement.
(d)?????????????? The Company Board will not (and no committee or subgroup thereof will) (i)?change, withdraw, withhold, qualify or modify, or publicly propose to change, withdraw, withhold, qualify or modify, or fail to make, the approval or recommendation by the Company Board of the Transactions or this Agreement, (ii)?approve, recommend, adopt or otherwise declare advisable, or propose publicly to approve, recommend, adopt or otherwise declare advisable, any Alternative Acquisition, (iii)?fail to include in the Joint Proxy Statement the recommendation of the Company Board in favor of this Agreement and the Transactions, (iv) take no position or remain neutral with respect to a publicly announced, or otherwise publicly disclosed, Acquisition Proposal for more than five (5) Business Days (or beyond the second (2nd) Business Day prior to the date of the Company Shareholder Meeting, if sooner), or (v) fail to publicly reaffirm its recommendation of this Agreement and the Transactions within five business days of GX’s written request to do so (or, if earlier, at least two Business Days prior to the Company Shareholder Meeting) following the public announcement of any Alternative Acquisition (or any material amendment thereof, including any change to the price or form of consideration) provided that GX will not be entitled to make such written request, and the Company Board will not be required to make such reaffirmation, more than once with respect to any particular Alternative Acquisition (any action or failure to act in clauses?(i) through (iv) being referred to as a “Company
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Recommendation Change”). Notwithstanding the foregoing, subject to Section 5.2(e), in the event that, prior to obtaining the Company Shareholder Approval, the Company Board determines in good faith (after consultation with its outside financial advisors and outside legal counsel) that (A) it has received a Superior Proposal and (B) the failure to make a Company Recommendation Change or terminate this Agreement would be reasonably likely to be inconsistent with the Company Board’s fiduciary duties under applicable Law, the Company Board shall give GX at least five Business Days from the later of the date on which GX received notice of a Superior Proposal in accordance with Section 5.2(e) and the date on which GX received all of the materials referred to in Section 5.2(e) with respect to each new Superior Proposal from the Company (the “Right to Match Period”) advance notice of any action to be taken by the Company Board to enter into or approve the entering into of an agreement in respect of the Superior Proposal and GX shall, during the Right to Match Period, have the right, but not the obligation, to propose in writing to amend the terms of this Agreement. The Company Board shall review in good faith and in consultation with its outside financial advisors and outside legal counsel any proposal by GX to amend the terms of this Agreement and the Transactions in order to determine, in good faith in the exercise of its fiduciary duties (after consultation with its outside financial advisors and outside legal counsel), whether GX’s proposal to amend the terms of this Agreement and the Transactions would result in the Acquisition Proposal not being a Superior Proposal, with respect to which the failure to make a Company Recommendation Change or terminate this Agreement would be reasonably likely to be inconsistent with the Company Board’s fiduciary duties under applicable Law. If requested by GX, the Company will, and will cause its Representatives to, during any Right to Match Period, engage in good faith negotiations with GX and its Representatives to make such adjustments in the terms and conditions of this Agreement so that such Acquisition Proposal would cease to constitute a Superior Proposal. Each successive amendment or modification to any Acquisition Proposal that results in an increase in, or modification of, the consideration (or value of such consideration) to be received by the Company Shareholders or other material terms or conditions thereof shall constitute a new Acquisition Proposal for the purposes of this Section 5.2, and GX shall be afforded a new full five (5) Business Day Right to Match Period from the later of the date on which GX received notice thereof in accordance with Section 5.2(e) and the date on which GX received all of the materials referred to in Section 5.2(e) with respect to each new Superior Proposal from the Company. The Company Board may (A) effect a Company Recommendation Change in respect of a Superior Proposal or (B) terminate this Agreement in accordance with Section 7.3(b) to enter into an agreement, understanding or arrangement in respect of a Superior Proposal only if (Y) GX does not, prior to the expiry of the Right to Match Period, propose to amend the terms of this Agreement, or (Z) GX delivers to the Company, prior to the expiry of the Right to Match Period, a proposal to amend the terms of this Agreement as contemplated in this Section 5.2(d), and thereafter the Company Board determines, in good faith in the exercise of its fiduciary duties (after consultation with its outside financial advisors and outside legal counsel), taking into account GX’s proposal to amend this Agreement, that (1) the Acquisition Proposal remains a Superior Proposal and (2) the failure to make a Company Recommendation Change or terminate this Agreement would be reasonably likely to be inconsistent with the Company Board’s fiduciary duties under applicable Law. It is understood and agreed that any amendment to any material term or condition of any Superior Proposal will require a new notice and a new Right to Match Period that will expire five Business Days following delivery of such new notice from the Company to GX.
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(e)??????????????? In addition to the obligations of the Company set forth in the Section 5.2 Company Provisions, the Company will promptly advise GX, at first orally and then in any event within 24 hours in writing of receipt or otherwise becoming aware thereof, of any request for information, proposal or inquiry relating to, or that would reasonably be expected to result in, an Alternative Acquisition, the material terms and conditions of such request, proposal or inquiry (including any changes thereto), the identity of the Person making such request, proposal or inquiry and copies of all written documents, correspondence or other material received in respect of, from or on behalf of any such Person. The Company will keep GX fully informed of the status and details (including amendments or proposed amendments) of any such request, proposal or inquiry on a prompt basis and shall promptly provide to GX copies of all material correspondence if in writing or electronic form, and if not in writing or electronic form, a description of the material or substantive terms of such correspondence communicated to the Company by or on behalf of any Person making such Acquisition Proposal, inquiry, proposal, offer or request and shall respond as promptly as practicable to all inquiries by GX with respect thereto. Following the Company Board’s good faith determination (after consultation with its outside financial advisors and outside legal counsel) that (i) it has received a Superior Proposal in accordance with Section 5.2(c) and (ii) the failure to make a Company Recommendation Change or terminate this Agreement would be reasonably likely to be inconsistent with the Company Board’s fiduciary duties under applicable Law,?the Company shall promptly, and in any event within 24 hours of such determination, deliver to GX a written notice of the determination of the Company Board that such Acquisition Proposal constitutes a Superior Proposal and of the intention of the Company Board to enter into such definitive agreement with respect to such Superior Proposal and to make a Company Recommendation Change, along with a complete copy of the definitive agreement for the Superior Proposal and all material supporting documentation, including any financing documents supplied to the Corporation in connection therewith. During any Right to Match Period, the Company shall discuss and negotiate in good faith and make its Representatives available to discuss and negotiate in good faith (in each case to the extent GX desires to negotiate) with GX and GX’s Representatives any proposed modifications to the terms and conditions of this Agreement or the Transactions so that the Acquisition Proposal does constitute a Superior Proposal, with respect to which the failure to make a Company Recommendation Change or terminate this Agreement would no longer be reasonably likely to be inconsistent with the Company Board’s fiduciary duties under applicable Law.
(f)??????????????? Nothing contained in this Agreement shall prohibit the Company Board, acting in good faith and upon advice of its outside financial advisors and outside legal counsel, from making any disclosure to Company Pre-Closing Shareholders as required by applicable Laws, including complying with section 2.17 of National Instrument 62-104 – “Take-Over Bids and Issuer Bids” of the Canadian Securities Administrators, as it may be amended from time to time, and similar provisions under applicable U.S. securities Laws relating to the provision of a directors’ circular in respect of an Acquisition Proposal; provided, however, that neither the Company nor the Company Board shall fail to reaffirm its recommendation of this Agreement and the Transactions in any such disclosure, or be permitted to recommend that the Company Pre-Closing Shareholders tender any securities in connection with any take-over bid that is an Acquisition Proposal or effect a Company Recommendation Change with respect thereto except as permitted by this Section?5.2.
(g)?????????????? The Company Board shall promptly reaffirm the Company Recommendation by press release after any Acquisition Proposal which is not determined to be a Superior Proposal is
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publicly announced or publicly disclosed or the Company Board determines that a proposed amendment to the terms of this Agreement or the Transactions as contemplated under Section 5.2(d) would result in an Acquisition Proposal no longer being a Superior Proposal. The Company shall provide GX and its outside legal with a reasonable opportunity to review the form and content of any such press release and shall make all reasonable amendments to such press release as requested by GX and its outside legal counsel.
Actually they could put their money into gxii now or a few months down the road and have no risk. Meanwhile we have all the risk and have had all the risk.
Or buy gxiiw warrants at .05 and leverage your investment.
Gxii is the better play.
There is no downside!
If you buy gxii at $10 and Niobf goes down considerably, say 30% instead of taking Niobf shares redeem your shares from gxii and receive back your investment and then go back and buy Niobf on the open market.
But if Niobf goes way up hold on to your gxii until March and receive locked in price of .89
Chico237 that is the 64000 dollar question. What should the market cap of Niocorp be with $600mm ebidta projections including REE and a financing agreement in place in March 2023? I wish I knew but I think much higher, for example at 5X ebidta market cap would be at $3billion
Putz, this 8k came out yesterday of FAQ. See below in red.
https://www.sec.gov/Archives/edgar/data/1512228/000153949722001644/n2574_x52-425.htm
FREQUENTLY ASKED QUESTIONS
ABOUT THE PROPOSED NIOCORP – GXII BUSINESS COMBINATION
WHAT IS THE BUSINESS COMBINATION THAT IS PROPOSED?
Under the terms of the Business Combination Agreement, dated September 25, 2022 (the “Business Combination Agreement”), among NioCorp Developments Ltd., a company organized under the laws of the Province of British Columbia (“NioCorp”), GX Acquisition Corp. II, a Delaware corporation (“GXII”), and Big Red Merger Sub Ltd, a Delaware corporation and a direct, wholly owned subsidiary of NioCorp, as the result of a series of transactions, GXII will become a subsidiary of NioCorp (as successor by merger to NioCorp’s subsidiary, Elk Creek Resources Corporation (“ECRC”)), with the pre-combination public shareholders of GXII receiving NioCorp common shares, and the GXII founders receiving shares in GXII (as successor by merger to ECRC) that are exchangeable into NioCorp common shares. The Business Combination Agreement contemplates that NioCorp will undertake a reverse stock split at the time of close in connection with an expected cross-listing to the Nasdaq Stock Market (“Nasdaq”). The transactions contemplated by the Business Combination Agreement and the ancillary agreements thereto are referred to collectively as the “Transaction.”
The proposed Transaction is expected to close in the first quarter of 2023, subject to effectiveness of the registration statement on Form S-4 (the “registration statement”) that NioCorp expects to file, the satisfaction of customary closing conditions, including certain governmental approvals, the approval of the Toronto Stock Exchange (“TSX”), and the approval of certain elements of the proposed Transaction by GXII shareholders and NioCorp shareholders. The proposed additional financings contemplated by the Business Combination Agreement will also be subject to the approval of the TSX and NioCorp shareholders.
Post-closing, the NioCorp Board will include two directors from pre-combination GXII.
Additional information may be found in the Current Reports on Form 8-K being filed by NioCorp and GXII with the U.S. Securities and Exchange Commission (“SEC”) and, in the case of NioCorp, with the applicable Canadian securities regulatory authorities, in connection with the announcement of the entry into the Business Combination Agreement and the proposed Transaction. Also refer to “Additional Information about the Proposed Transaction and Where to Find It” below.
NioCorp intends to use the proceeds from the proposed Transaction and the contemplated financings to advance its efforts to launch construction of the Elk Creek Critical Minerals Project (the “Elk Creek Project”) and help move it to commercial operation.
WHO IS GX ACQUISITION CORP. II?
GX Acquisition Corp. II is a special purpose acquisition company (“SPAC”) led by Jay R. Bloom and Dean C. Kehler, as co-Chairmen and Chief Executive Officers, and Michael G. Maselli, as President. Funds managed by Mr. Bloom and Mr. Kehler have invested approximately $1.75 billion in over 60 acquisitions and other private equity transactions of which they have taken 13 companies public. The team has deep experience in public equity and credit markets as well as experience in project finance. GXII is publicly traded on the Nasdaq under the ticker symbols “GXII” (Class A Shares), “GXIIU” (Units), and “GXIIW” (Warrants).
WHAT IS A SPAC?
A SPAC is a publicly traded company that raises capital through an initial public offering for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses. In this case, GXII has entered into the Business Combination Agreement to complete a business combination with NioCorp.
In the case of SPACs, in connection with the shareholder meeting to approve the transaction, the investors in the SPAC can choose whether they want to keep the money they invested in the SPAC or cash out (i.e., “redeem” their shares). The amount of cash remaining in the SPAC’s trust account following any such redemptions and the payment of transaction expenses would then be available to the combined company upon consummation of the transaction.
GXII received gross proceeds of U.S.$300 million in connection with its initial public offering. Assuming no redemptions by GXII shareholders of GXII stock, NioCorp may receive up to U.S.$285 million in cash to the balance sheet upon closing of the Transaction, after giving effect to transaction expenses. If any GXII shareholders elect to redeem, however, the amount of cash available to NioCorp upon the closing of the Transaction will be decreased by an amount equal to the amount that GXII is required to repay to its redeeming shareholders.
WHY IS THIS BUSINESS COMBINATION RIGHT FOR NIOCORP?
The approximately U.S.$0.89 per NioCorp share equity rollover value represents an approximately 14% and approximately 12.6% premium to NioCorp’s common share spot price and 20-day volume-weighted average common share price, respectively, as of September 23, 2022.
The Transaction has the potential to significantly accelerate NioCorp’s efforts to obtain the required Elk Creek Project financing by increasing exposure to institutional investors looking to make strategic investments in critical minerals plays that are crucial to the world’s clean energy transition. The Transaction also has the potential to:
· Provide NioCorp with up to $285 million in net cash proceeds at the consummation of the Transaction, depending upon GXII share redemptions, and up to an additional $81 million over the next three years, depending on the consummation of other additional financing
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arrangements that NioCorp and GXII intend to pursue prior to and following the expected closing of the proposed Transaction.
· Improve trading liquidity through the expected listing of NioCorp’s common shares on the Nasdaq.
· Increase public awareness of NioCorp resulting from the expected listing of NioCorp’s common shares on Nasdaq.
· Provide access to a broader range of financing alternatives if the Nasdaq listing is achieved.
· Increase public awareness with respect to the unique position of the Elk Creek Project at a critical time as a potentially vital component to help secure U.S. supply chains for critical minerals needed for rapidly growing technologies such as electric vehicles, renewable power, and energy-efficient electric motors.
WHY IS THIS BUSINESS COMBINATION RIGHT FOR GXII?
In considering the business combination with NioCorp, GX considered a number of factors, including among others, that the business combination provides an opportunity to invest in NioCorp’s Elk Creek Project, a pure-play critical minerals project with the highest-grade Niobium resource in North America and the second largest indicated rare earth resource in the U.S.1 We believe NioCorp is well-positioned to be a reliable, U.S.-based supplier of Niobium, Scandium and Titanium, helping meet the growing demand for these minerals and providing domestic supply security. NioCorp has an experienced management team to advance the company’s strategic and growth plans. NioCorp’s mission is to accelerate the global transition to a lower carbon economy by serving as a reliable and sustainable U.S. supplier critical mineral, highlighting its ESG focus.
HOW IS THE NUMBER OF NIOCORP COMMON SHARES ISSUABLE TO GXII SHAREHOLDERS UPON CONSUMMATION OF THE TRANSACTION DETERMINED?
At the closing of the Transaction, GXII shareholders will receive NioCorp common shares based on a fixed exchange ratio of 11.1829212 (the “Exchange Ratio”) NioCorp common shares for each GXII Class A common share held and not redeemed. The GXII founders will initially receive Class B shares in GXII, as the surviving entity of the mergers, based on the Exchange Ratio and, after closing, will have the right to exchange those Class B shares for NioCorp common shares on a one-for-one basis under certain conditions. The Exchange Ratio was determined based on the agreed-upon valuations of NioCorp and GXII and is set forth in the Business Combination Agreement. The Exchange Ratio will not change, regardless of changes in NioCorp’s or GXII’s public share price prior to the consummation of the Transaction.
1 Indicated mineral resource, based on data from the “Critical Mineral Resources of the United States—Economic and Environmental Geology and Prospects for Future Supply,” U.S. Geological Survey, 2017, and from company-issued reports.
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WHAT WILL HAPPEN TO GXII WARRANTS AS A RESULT OF THE BUSINESS COMBINATION?
Pursuant to the Business Combination Agreement, NioCorp will assume the GXII warrant agreement and each GXII warrant that is issued and outstanding immediately prior to the business combination will be converted into a warrant to acquire NioCorp common shares (each, a “NioCorp Assumed Warrant”). The number of NioCorp common shares subject to each NioCorp Assumed Warrant shall be equal to the number of GXII Class A Shares subject to the applicable GX warrant multiplied by the Exchange Ratio, with the applicable exercise price to be adjusted accordingly.
WHAT WILL NIOCORP SHAREHOLDERS OWN AS A RESULT OF THE BUSINESS COMBINATION?
As a result of the business combination, NioCorp shareholders will continue to own NioCorp common shares, which are expected to be traded after the close of the Transaction on both the Nasdaq and the TSX. Assuming no redemptions by GXII shareholders of GXII stock, NioCorp may receive up to $285 million in cash to the balance sheet after the Transaction closes.
WHY IS NIOCORP PLANNING TO EFFECT A REVERSE STOCK SPLIT IN CONJUNCTION WITH THE BUSINESS COMBINATION?
Following the successful closing of the Transaction, NioCorp expects to be able to cross-list to the Nasdaq. Having shares traded on the Nasdaq, in addition to NioCorp’s current Toronto Stock Exchange (“TSX”) listing, is expected to (1) increase NioCorp’s exposure to a broader range of investors worldwide, (2) facilitate greater institutional ownership of NioCorp, and (3) improve NioCorp’s trading liquidity.
In order to be listed on the Nasdaq, NioCorp will have to satisfy several listing requirements, including a minimum share price. NioCorp intends to conduct a reverse stock split to help ensure that NioCorp will satisfy such minimum share price requirement. The ratio of the reverse stock split is yet to be determined. It is important to note that a reverse stock split does not affect the value of a shareholder’s investment in NioCorp. For example, if a shareholder has 100 shares of NioCorp at a market price of $1/share prior to a reverse stock split, the market value of the shareholder’s investment is $100. If the Company conducts a one-for-10 reverse stock split, the shareholder would then own 10 shares of NioCorp at a per share market price of $10 immediately following the reverse stock split. The market value of the shareholder’s investment in NioCorp would still be $100, and would not change as a result of the reverse stock split
WHEN WILL THE BUSINESS COMBINATION BE COMPLETED?
The parties currently expect the business combination to be completed during the first quarter of 2023. The actual date of closing will be dependent upon a number of factors, including, without limitation, the SEC’s review of the registration statement to be filed in connection with the proposed Transaction.
Following the effectiveness of the registration statement, NioCorp will hold a special meeting of shareholders at which shareholders will be asked to approve the following:
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· the issuance of the NioCorp securities issuable in connection with the Transaction and other financing arrangements;
· an amendment to the articles of NioCorp, as amended effective January 27, 2015, to comply with applicable listing requirements of Nasdaq; and
· any other proposals that are necessary to effectuate the Transaction.
GXII will also hold a shareholders’ meeting at which GXII shareholders will be asked to approve the following:
· an amendment to GXII’s Amended and Restated Certificate of Incorporation (the “GXII Charter”) to eliminate the automatic conversion of shares of Class B Common Stock of GXII, all of which are held by the GX II founders, into GXII Class A Shares at the time of a Business Combination (as defined in the GXII Charter);
· the Transaction; and
· any other proposals that are necessary to effectuate the Transaction.
After approval of the GXII and NioCorp shareholders, and assuming satisfaction of the other conditions to the consummation of the Transaction, including the approval of the TSX, the Transaction will be consummated.
DID THE NIOCORP BOARD OBTAIN A THIRD-PARTY VALUATION OR FAIRNESS OPINION IN DETERMINING WHETHER OR NOT TO PROCEED WITH THE BUSINESS COMBINATION?
Yes. GenCap Mining Advisory Ltd. has provided a fairness opinion to the Board of Directors of NioCorp stating that, as of the date of such opinion, and based upon and subject to the assumptions, limitations, and qualifications stated in such opinion, the Transaction is fair from a financial point of view to NioCorp shareholders.
WILL NIOCORP OBTAIN NEW FINANCING IN CONNECTION WITH THE TRANSACTIONS?
NioCorp announced the signing of non-binding letters of intent (“LOIs”) for two separate financing packages with Yorkville Advisors Global, LP (“Yorkville”). Subject to entering into definitive agreements, these financings could provide NioCorp with access to up to an additional $81 million to help advance the Elk Creek Project. The financings contemplated by the LOIs include $16 million in convertible debentures that are expected to be funded at the closing of the business combination, and subject to certain limitations, can be repaid by NioCorp in either cash or NioCorp common shares, and a standby equity purchase facility pursuant to which NioCorp will have the ability to require Yorkville, subject to the conditions set out in the definitive agreements, to purchase up to $65 million of its common shares.
WHAT CONDITIONS MUST BE SATISFIED TO COMPLETE THE BUSINESS COMBINATION?
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The consummation of the Transaction is subject to the satisfaction or waiver of certain customary closing conditions contained in the Business Combination Agreement, including, among other things:
1. obtaining required approvals of the Transaction and related matters by the respective shareholders of NioCorp and GXII;
2. approval of the TSX;
3. the effectiveness of the registration statement;
4. receipt of approval for listing the NioCorp common shares to be issued in connection with the Transaction on Nasdaq;
5. receipt of approval for listing the NioCorp common share purchase warrants to be issued in connection with the Transaction on Nasdaq;
6. that NioCorp and its subsidiaries (including GXII) will have at least $5,000,001 of net tangible assets upon the consummation of the Transaction;
7. that, at closing, NioCorp and its subsidiaries (including GXII) will have received cash in an amount equal to or greater than $15,000,000 in connection with the Transaction, subject to certain adjustments; and
8. the absence of any injunctions enjoining or prohibiting the consummation of the Business Combination Agreement.
HOW IS THE NIOCORP / GXII TRANSACTION DISTINGUISHABLE FROM OTHER RECENT SPAC TRANSACTIONS?
We believe that the proposed Transaction is distinguishable from recent SPAC transactions in the following ways:
1. Unlike most SPAC combinations, NioCorp is already publicly traded on the TSX, meaning that the Transaction was able to be struck based on an established public market value of NioCorp. Most SPAC combinations are proposed mergers between publicly traded SPACs and private companies, which has in some cases presented challenges to the post-merger entities because of a lack of market acceptance of the private company valuation and limited post-closing float.
2. NioCorp has been an SEC filer for more than six years and management has significant experience with the reporting requirements of being a U.S. public company.
3. NioCorp and GX have signed non-binding LOIs for two separate financing packages with Yorkville. Subject to entering into definitive agreements, these financings could provide NioCorp with access to up to an additional $81 million to help advance the Elk Creek Project, which NioCorp can use
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whether or not there are GXII redemptions. The execution of definitive documentation with Yorkville is not a condition to closing the business combination transaction.
WHY GXII?
The GXII team is highly experienced. They have been investors in more than 60 businesses, more than a dozen of which were publicly listed companies. Most importantly, they have significant experience in project financings.
IF I PURCHASE NIOCORP COMMON SHARES TODAY AND HELD THEM THROUGH THE CLOSING OF THE TRANSACTION, WHAT WILL HAPPEN TO THOSE SHARES UPON CLOSING?
If you purchase NioCorp common shares today and held them through the closing of the Transaction, assuming the conditions to closing the Transaction are met, then upon closing, you will continue to own those NioCorp common shares. In connection with the closing of the Transaction, NioCorp will issue new NioCorp common shares in an amount based on the Exchange Ratio to GXII shareholders that do not redeem their GXII Class A common shares in connection with the Transaction. In addition, the Business Combination Agreement contemplates that, at the time of the closing of the Transaction, NioCorp will undertake a reverse stock split at a to-be-determined ratio so as to effectuate an expected cross-listing to the Nasdaq.
IF I PURCHASE GXII CLASS A COMMON SHARES TODAY AND HELD THEM THROUGH THE CLOSING OF THE TRANSACTION, WHAT WILL HAPPEN TO THOSE SHARES UPON CLOSING?
If you purchase GXII Class A common shares today and held them through the closing of the Transaction, your GXII Class A common shares will be exchanged for NioCorp common shares in an amount based on the Exchange Ratio. In addition, the Business Combination Agreement contemplates that, at the time of the closing of the Transaction, NioCorp will undertake a reverse stock split at a to-be-determined ratio so as to effectuate an expected cross-listing to the Nasdaq.
Additional Information about the Proposed Transaction and Where to Find It
In connection with the proposed Transaction, NioCorp intends to file the registration statement with the SEC, which will include a document that serves as a prospectus and proxy circular of NioCorp and a proxy statement of GXII, referred to as a “joint proxy statement/prospectus.” The definitive joint proxy statement/prospectus will be filed with the SEC as part of the registration statement and, in the case of NioCorp, with the applicable Canadian securities regulatory authorities, and will be sent to all NioCorp shareholders and GXII stockholders as of the applicable record date to be established. Each of NioCorp and GXII may also file other relevant documents regarding the proposed Transaction with the SEC and, in the case of NioCorp, with the applicable Canadian securities regulatory authorities. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS OF NIOCORP AND GXII ARE URGED TO READ THE REGISTRATION STATEMENT, THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS AND ALL OTHER RELEVANT DOCUMENTS FILED OR THAT WILL BE FILED WITH
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the SEC and, in the case of niocorp, with the applicable canadian securities regulatory authorities in connection with the proposed Transaction, including any amendments or supplements to these documents, carefully and in their entirety because they will contain important information about the proposed Transaction.
Investors and security holders will be able to obtain free copies of the registration statement and the joint proxy statement/prospectus (if and when available) and all other relevant documents that are filed or that will be filed with the SEC by NioCorp or GXII through the website maintained by the SEC at www.sec.gov. Investors and security holders will be able to obtain free copies of the joint proxy statement/prospectus (if and when available) and all other relevant documents that are filed or that will be filed with the applicable Canadian securities regulatory authorities by NioCorp through the website maintained by the Canadian Securities Administrators at www.sedar.com. The documents filed by NioCorp and GXII with the SEC and, in the case of NioCorp, with the applicable Canadian securities regulatory authorities also may be obtained by contacting NioCorp at 7000 South Yosemite, Suite 115, Centennial CO 80112, or by calling (720) 639-4650; or GXII at 1325 Avenue of the Americas, 28th Floor, New York, NY 10019, or by calling (212) 616-3700.
Participants in the Solicitation
NioCorp, GXII and certain of their respective directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be participants in the solicitation of proxies from NioCorp’s shareholders and GXII’s stockholders in connection with the proposed Transaction. Information regarding the executive officers and directors of NioCorp is included in its management information and proxy circular for its 2021 annual general meeting of shareholders filed with the SEC and the applicable Canadian securities regulatory authorities on October 22, 2021. Information regarding the executive officers and directors of GXII is included in its Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 25, 2022. Additional information regarding the persons who may be deemed to be participants in the solicitation, including information regarding their interests in the proposed Transaction, will be contained in the registration statement and the joint proxy statement/prospectus (if and when available). NioCorp’s shareholders and GXII’s stockholders and other interested parties may obtain free copies of these documents free of charge by directing a written request to NioCorp or GXII.
No Offer or Solicitation
This communication and the information contained herein do not constitute (i) (a) a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the proposed Transaction or (b) an offer to sell or the solicitation of an offer to buy any security, commodity or instrument or related derivative, nor shall there be any sale of securities in any jurisdiction in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction or (ii) an offer or commitment to lend, syndicate or arrange a financing, underwrite or purchase or act as an agent or advisor or in any other capacity with respect to any transaction, or commit capital, or to participate in any trading strategies. No offer of securities in the United States or to or for the account or benefit of U.S. persons (as defined in Regulation S under the Securities Act) shall be made except by means of a prospectus meeting the requirements of Section 10
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of the Securities Act of 1933, as amended (the “Securities Act”), or an exemption therefrom. Investors should consult with their counsel as to the applicable requirements for a purchaser to avail itself of any exemption under the Securities Act. In Canada, no offering of securities shall be made except by means of a prospectus in accordance with the requirements of applicable Canadian securities laws or an exemption therefrom. This communication is not, and under no circumstances is it to be construed as, a prospectus, offering memorandum, an advertisement or a public offering in any province or territory of Canada. In Canada, no prospectus has been filed with any securities commission or similar regulatory authority in respect of any of the securities referred to herein.
Forward-Looking Statements
This communication contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking statements may include, but are not limited to, statements about the parties’ ability to close the proposed Transaction, including NioCorp and GXII being able to receive all required regulatory, third-party and shareholder approvals for the proposed Transaction; the anticipated benefits of the proposed Transaction, including the potential amount of cash that may be available to the combined company upon consummation of the proposed Transaction and the use of the net proceeds following the redemptions by GXII public shareholders; NioCorp’s expectation that its common shares will be accepted for listing on the Nasdaq Stock Market following the closing of the proposed Transaction; the execution of definitive agreements relating to the convertible debenture transaction and the stand by equity purchase facility contemplated by the term sheets with Yorkville; the financial and business performance of NioCorp; NioCorp’s anticipated results and developments in the operations of NioCorp in future periods; NioCorp’s planned exploration activities; the adequacy of NioCorp’s financial resources; NioCorp’s ability to secure sufficient project financing to complete construction and commence operation of the Elk Creek Project; NioCorp’s expectation and ability to produce niobium, scandium, and titanium at the Elk Creek Project; the outcome of current recovery process improvement testing, and NioCorp’s expectation that such process improvements could lead to greater efficiencies and cost savings in the Elk Creek Project; the Elk Creek Project’s ability to produce multiple critical metals; the Elk Creek Project’s projected ore production and mining operations over its expected mine life; the completion of the demonstration plant and technical and economic analyses on the potential addition of magnetic rare earth oxides to NioCorp’s planned product suite; the exercise of options to purchase additional land parcels; the execution of contracts with engineering, procurement and construction companies; NioCorp’s ongoing evaluation of the impact of inflation, supply chain issues and geopolitical unrest on the Elk Creek Project’s economic model; the impact of health epidemics, including the COVID-19 pandemic, on NioCorp’s business and the actions NioCorp may take in response thereto; and the creation of full time and contract construction jobs over the construction period of the Elk Creek Project. In addition, any statements that refer to projections (including Averaged EBITDA, Averaged EBITDA Margin and After-Tax Cumulative Net Free Cash Flow), forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “continue,” “could,” “may,” “might,” “possible,” “potential,” “predict,” “should,” “would” and other similar words and expressions, but the absence of these words does not mean that a statement is not forward-looking.
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The forward-looking statements are based on the current expectations of the management of NioCorp and GXII, as applicable, and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. Forward-looking statements reflect material expectations and assumptions, including, without limitation, expectations and assumptions relating to: the future price of metals; the stability of the financial and capital markets; NioCorp and GXII being able to receive all required regulatory, third-party and shareholder approvals for the proposed Transaction; the amount of redemptions by GXII public shareholders; the execution of definitive agreements relating to the convertible debenture transaction and the stand by equity purchase facility contemplated by the term sheets with Yorkville; and other current estimates and assumptions regarding the proposed Transaction and its benefits. Such expectations and assumptions are inherently subject to uncertainties and contingencies regarding future events and, as such, are subject to change. Forward-looking statements involve a number of risks, uncertainties or other factors that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those discussed and identified in public filings made by NioCorp and GXII with the SEC and, in the case of NioCorp, with the applicable Canadian securities regulatory authorities and the following: the amount of any redemptions by existing holders of GXII Class A Shares being greater than expected, which may reduce the cash in trust available to NioCorp upon the consummation of the business combination; the occurrence of any event, change or other circumstances that could give rise to the termination of the Business Combination Agreement and/or payment of the termination fees; the outcome of any legal proceedings that may be instituted against NioCorp or GXII following announcement of the Business Combination Agreement and the transactions contemplated therein; the inability to complete the proposed transactions due to, among other things, the failure to obtain NioCorp shareholder approval or GXII shareholder approval or the execution of definitive agreements relating to the convertible debenture transaction and the stand by equity purchase facility contemplated by the term sheets with Yorkville; the risk that the announcement and consummation of the proposed transactions disrupts NioCorp’s current plans; the ability to recognize the anticipated benefits of the proposed transactions; unexpected costs related to the proposed transactions; the risks that the consummation of the proposed transactions is substantially delayed or does not occur, including prior to the date on which GXII is required to liquidate under the terms of its charter documents; NioCorp’s ability to operate as a going concern; NioCorp’s requirement of significant additional capital; NioCorp’s limited operating history; NioCorp’s history of losses; cost increases for NioCorp’s exploration and, if warranted, development projects; a disruption in, or failure of, NioCorp’s information technology systems, including those related to cybersecurity; equipment and supply shortages; current and future offtake agreements, joint ventures, and partnerships; NioCorp’s ability to attract qualified management; the effects of the COVID-19 pandemic or other global health crises on NioCorp’s business plans, financial condition and liquidity; estimates of mineral resources and reserves; mineral exploration and production activities; feasibility study results; changes in demand for and price of commodities (such as fuel and electricity) and currencies; changes or disruptions in the securities markets; legislative, political or economic developments; the need to obtain permits and comply with laws and regulations and other regulatory requirements; the possibility that actual results of work may differ from projections/expectations or may not realize the perceived potential of NioCorp’s projects; risks of accidents, equipment breakdowns, and labor disputes or other unanticipated difficulties or interruptions; the possibility of
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cost overruns or unanticipated expenses in development programs; operating or technical difficulties in connection with exploration, mining, or development activities; the speculative nature of mineral exploration and development, including the risks of diminishing quantities of grades of reserves and resources; claims on the title to NioCorp’s properties; potential future litigation; and NioCorp’s lack of insurance covering all of NioCorp’s operations.
Should one or more of these risks or uncertainties materialize or should any of the assumptions made by the management of NioCorp and GXII prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.
All subsequent written and oral forward-looking statements concerning the proposed Transaction or other matters addressed in this communication and attributable to NioCorp, GXII or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements contained or referred to herein. Except to the extent required by applicable law or regulation, NioCorp and GXII undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this communication to reflect the occurrence of unanticipated events
When you look at the facts a reverse split is necessary to uplist.
After the merger (assuming no gxii shares are redeemed) there will be 698,445,426 niobf shares outstanding along with 175,199,103 niobf warrants
To uplist on NASDAQ there is a required minimum price of $4
Possible Options:
698,445,426 X $1 (does not qualify) gives market cap of $698,445,426
reverse 1 for 5 gives 139,689,085 shares at $5
reverse 1 for 10 gives 69,844,543 shares at $10
These are 2 different issues. I am referring to the merger shares and you are talking about the reverse split.
Mark is misleading when he talks about GXII getting niobf shares at .89 but fails to mention that Dean and Jay are getting 83,326,691 niobf at .0003
And then he fails to mention the warrants that will convert into 175,199,103 niobf.
This is because the exchange ratio is 11.1829212 niobf for 1 gxii.
I saw the video. Mark was careful to point out that GXII class A shares will convert to NIOBF at about .89 cents. That is true. But why didn't he mention the GXII class B shares will convert into 83,871,909 niobf shares at a cost of .0003 cents.
And Mark did not even mention the 15.6 million GXII warrants that exchange into NIOBF warrants and can later be exercised into 175,199,103 niobf shares at an exercise price of about $1.02
Also they used the word "exchange ratio". Why not just say 11.1829212 niobf for each gxii?
A bird in hand is better than two in the bush.
You are always cracking me up. So now are we going to be bouncing off support or ricocheting off the top. Lol
I have tried to calculate how Niocorp came up with the 11 for 1 and the ramifications to existing shareholders. Niocorp is giving 11 for 1 for the gxii class A shares, and also 11 for 1 of gxii class B shares, and also for gxii warrants which will exchange into niobf warrants and come with the right to receive 11 for 1 also. I understand how they came up with 11 for 1 but CNN fake news does not allow the truth.
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=170120020
I disagree Putz. The 8k says the measurement date was September 20. It uses the combined market caps of both companies on that date; that is how they get a 32% / 68% split. When you do the numbers GXII needs the 11 to 1 to maintain those percentages.
Agreed. For me it is not really a reverse split but more like a recapitalization. But the r/s is likely needed for a listing.
It is linked at the bottom of the 8k for the merger
https://www.sec.gov/Archives/edgar/data/1512228/000153949722001611/n2574_x43exh2-1.htm