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NexGen Announces US$60 Million Strategic Investment by CEF Holdings

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masslanding   Thursday, 06/02/16 01:06:35 PM
Re: mick post# 14
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NexGen Announces US$60 Million Strategic Investment by CEF Holdings

Canada NewsWire

VANCOUVER, June 2, 2016

VANCOUVER, June 2, 2016 /CNW/ - NexGen Energy Ltd. ("NexGen" or the "Company") (TSXV:NXE, OTCQX:NXGEF) is pleased to announce that it has entered into a binding term sheet with CEF Holdings Limited ("CEF") to issue and sell to CEF and/or affiliates of its shareholders US$60 million in aggregate principal amount of unsecured convertible debentures of NexGen (the "Debentures").

Leigh Curyer, Chief Executive Officer of NexGen commented: "It is a pleasure to welcome CEF as a partner and strategic investor into NexGen. We have been working to secure the right partner for Arrow over the last 12 months in order to advance the project which is among the best undeveloped uranium assets. CEF understands the strategic significance of Arrow and NexGen's development strategy. This is evident by CEF committing to support NexGen's board and executive through the Company's development. This supportive strategic investment represents one of the most significant financing steps in NexGen's history and provides the Company with sufficient capital to continue to optimize the future development of Arrow."

Warren Gilman, Chief Executive Officer of CEF commented: "CEF searches the world for mineral resources which rank amongst the best in their sector and NexGen's Arrow deposit meets that criteria in uranium. We are delighted to support the NexGen team in moving Arrow and the Rook 1 property toward production."

The Terms

The Debentures will carry a 7.5% coupon (the "Interest") over a 5-year term. The Debentures will be convertible at the holder's option into common shares of the Company ("Common Shares") at a conversion price (the "Conversion Price") of US$2.33 (C$3.05 at current exchange rate of 1.31), equal to a 30% premium to the 20-day volume-weighted average trading price calculated in U.S dollars ("20-day VWAP") of Common Shares prior to announcement.

The Company shall be entitled, on or after the third anniversary of the date of the issuance of the Debentures, at any time that the 20-day VWAP of the Common Shares exceeds 130% of the Conversion Price, to redeem the Debentures at par plus accrued and unpaid Interest if the Debentures are not converted after 30 days' notice.

Two thirds of the Interest (equal to 5% per annum) is payable in cash. One third of the Interest (equal to 2.5% per annum) is payable in Common Shares issuable at a price equal to the 20-day VWAP ending on the day prior to the date on which such Interest payment is due.

Subject to an Investment Agreement to be entered into between the parties, CEF will agree to: (i) not tender (or convert) the Debentures or any Common Shares acquired on exercise of the Debentures or otherwise to an unsolicited takeover bid, unless a bidder takes-up and pays for a sufficient number of Common Shares such that it, and persons acting jointly or in concert with it, hold more than 66 2/3% of the outstanding Common Shares of the Company, calculated on a fully-diluted basis; (ii) exercise the votes attached to all Common Shares acquired on exercise of the Debentures or otherwise in respect of any change of control transaction, in accordance with the recommendation of the Company's Board of Directors; and (iii) abstain from voting any Common Shares obtained on conversion of the Debentures or otherwise in respect of the election of individuals to the Company's Board of Directors who are not nominees of management.

Use of Proceeds

Including the proceeds from the sale of the Debentures, NexGen will have cash reserves of approximately C$100 million. Proceeds from the Debentures will be used to fund the continuing exploration and development of the Company's SW2 properties (which includes the Rook 1 project and the Arrow deposit) and for general corporate purposes. These development initiatives at Arrow include detailed engineering, environmental and permitting studies in conjunction with continued definition and expansion drilling.

Approval

The proposed transaction is subject to the satisfaction of customary closing conditions, including regulatory approval, the completion of definitive documentation, there being no material adverse change in the business of the Company or any laws affecting the Company, or a major event that disrupts the markets or the business of the Company.

Conference Call

NexGen will host a conference call today, June 2, 2016 at 8:30 a.m. Eastern Standard Time. Participants may join the conference call using the following call-in details:

Participant Toll Free Dial-In: +1 888 231 8191
Participant International Dial-In: +1 647 427 7450
A replay of this conference call will be available until August 4, 2016. The playback numbers are: Local/International: +1 416 849 0833
North America Toll Free: +1 855 859 2056
Playback Passcode: 26009550 #

Advisors

TD Securities Inc. is acting as financial advisor and lead placement agent. Farris Vaughn Wills & Murphy LLP is acting as Canadian legal counsel to NexGen. CIBC World Markets Inc. is acting as financial advisor to CEF. Stikeman Elliott LLP is acting as Canadian legal counsel to CEF.

About CEF Holdings Limited

CEF Holdings Limited is owned 50% by CK Hutchison Holdings Ltd. and 50% by CIBC. CK Hutchison Holdings is the publicly-listed flagship company of the CK Hutchison Group of companies, the Hong Kong based multi-national conglomerate with a combined market cap of the Group in excess of $100 billion as of December 31, 2015. CIBC is a leading Canadian-based global financial institution with operations around the world. CEF is an investor in significant resource assets on a global basis.

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