Lithium Americas Corp S-3, filed May 15, 2025
Lithium Americas Corp. (LAC)
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As filed with the Securities and Exchange Commission on May 15, 2025
Registration Statement No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Lithium Americas Corp.
(Exact name of registrant as specified in its charter)
| British Columbia, Canada | Not Applicable | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
3260 – 666 Burrard Street
Vancouver, BC V6C 2X8
(778) 656-5820
(Address, Including Zip Code and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)
Edward Grandy
Senior Vice President, General Counsel and Corporate Secretary
5310 Kietzke Ln, Suite 200
Reno, Nevada 89511
(775) 827-3318
(Name, Address, Including Zip Code and Telephone Number, Including Area Code, of Agent for Service)
With a Copy to:
Jackson A. O’Maley
Benjamin N. Heriaud
Vinson & Elkins L.L.P.
845 Texas Avenue, Suite 4700
Houston, Texas 77002
(713) 758-2222
Approximate date of commencement of proposed sale to the public:
From time to time on or after the effective date of this registration statement.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. ☐
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ☐
If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Securities Exchange Act of 1934, as amended.
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
| Emerging growth company | ☒ | |||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.
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EXPLANATORY NOTE
This registration statement consists of three prospectuses:
| • | A base prospectus, which covers the offering, issuance and sale by us of up to $1,000,000,000 in the aggregate of Common Shares and preferred shares of Lithium Americas Corp. from time to time in one or more offerings; |
| • | A resale prospectus, which covers Common Shares of Lithium Americas Corp. that may be sold in one or more secondary offerings by the selling shareholder named in the resale prospectus; and |
| • | An equity distribution agreement prospectus, which covers the offering, issuance and sale by us of up to $100,000,000 in the aggregate of Common Shares that may be issued and sold from time to time under an equity distribution agreement by and among Lithium Americas Corp., TD Securities (USA) LLC and TD Securities Inc., as sales agents. |
The base prospectus immediately follows this explanatory note. The specific terms of any securities to be offered pursuant to the base prospectus will be specified in a prospectus supplement to the base prospectus. The resale prospectus immediately follows the base prospectus and the equity distribution agreement prospectus immediately follows the resale prospectus. The $100,000,000 of Common Shares that may be offered, issued and sold under the equity distribution agreement prospectus is included in the $1,000,000,000 of securities that may be offered, issued and sold by us under the base prospectus. Upon termination of the equity distribution agreement, any portion of the $100,000,000 included in the equity distribution agreement prospectus that is not sold pursuant to the equity distribution agreement will be available for sale in other offerings pursuant to the base prospectus, and if no shares are sold under the equity distribution agreement, the full $100,000,000 of securities may be sold in other offerings pursuant to the base prospectus.
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The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED MAY 15, 2025
PRELIMINARY PROSPECTUS
Lithium Americas Corp.
US$1,000,000,000
Common Shares
Preferred Shares
This prospectus relates to the offer and sale by us up to an aggregate US$1,000,000,000 of the securities identified above (the “securities”) of Lithium Americas Corp. (“LAC,” the “Company,” “we,” “our” or “us”).
This prospectus provides you with a general description of the securities offered hereby, including the Company’s common shares, no par value (the “Common Shares”), and the general manner in which we will offer such securities. More specific terms of any securities that we offer may be provided in a prospectus supplement that describes, among other things, the specific amounts and prices of the securities being offered and the terms of the offering. The prospectus supplement may also add, update or change information contained in this prospectus.
We may offer and sell these securities from time to time in amounts, at prices and on terms to be determined by market conditions and other factors at the time of our offerings, including at prevailing market prices or at prices negotiated with buyers. We may offer and sell these securities through agents, through underwriters or dealers or directly to one or more purchasers, including existing shareholders. This prospectus provides you with a general description of these securities and the general manner in which we will offer the securities. Each time securities are offered, we will provide a prospectus supplement that will contain specific information about the terms of that offering. For example, any specific allocation of the net proceeds of an offering of securities to a specific purpose will be determined at the time of the offering and will be described in any applicable prospectus supplement. The prospectus supplement may also add, update or change information contained in this prospectus.
Our Common Shares are traded on the New York Stock Exchange (“NYSE”) and the Toronto Stock Exchange (“TSX”) under the symbol “LAC.” The closing price for our Common Shares on May 14, 2025, was US$3.08 per share, as reported on the NYSE and was C$4.32 per share, as reported on the TSX.
Investing in our securities involves risks. See “Risk Factors” beginning on page 8.
Neither the U.S. Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of the securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2025.
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We have not authorized anyone to provide any information or to make any representations other than those contained or incorporated by reference in this prospectus, any accompanying prospectus supplement or any free writing prospectus we have prepared. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the securities offered hereby and only under circumstances and in jurisdictions where it is lawful to do so. The information contained or incorporated by reference in this prospectus is current only as of its date.
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This prospectus is part of a registration statement on Form S-3 that we filed with the SEC using a “shelf” registration process. Under this shelf registration process, we may sell any combination of the securities described in this prospectus from time to time and in one or more offerings up to a total dollar amount of $1,000,000,000. This prospectus generally describes Lithium Americas Corp. and its securities, including its Common Shares. We may use the shelf registration statement to sell the listed securities from time to time through any means described in the section entitled “Plan of Distribution.”
More specific terms of any securities we offer may be provided in a prospectus supplement that describes, among other things, the specific amounts and prices of the securities being offered, any specific allocation of the net proceeds of an offering of securities to a specific purpose and other terms of the offering. The prospectus supplement may also add, update or change information included in this prospectus. You should read both this prospectus and any applicable prospectus supplement, together with additional information described below under the captions “Where You Can Find More Information” and “Incorporation of Certain Information by Reference.”
No offer of the securities will be made in any jurisdiction where the offer is not permitted.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
The information in this prospectus contains or incorporates by reference information that includes or is based upon “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”). All statements, other than statements of historical facts, are forward-looking statements and can be identified by the use of statements that include, but are not limited to, words, such as “anticipate,” “plan,” “continue,” “estimate,” “expect,” “may,” “will,” “project,” “predict,” “proposes,” “potential,” “target,” “implement,” “schedule,” “forecast,” “intend,” “would,” “could,” “might,” “should,” “believe” and similar terminology, or statements that certain actions, events or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved. Forward-looking statements in this prospectus, including the documents incorporated by reference, includes, but is not limited to:
| • | statements relating to the anticipated sources and uses of funds to complete project financing, statements relating to the investment agreement with General Motors Holdings LLC (“GM”) to establish a joint venture with the Company for the purposes of funding, developing, constructing and operating the Thacker Pass project (the “Project” and, such transaction, the “JV Transaction”), the Conditional Commitment from the U.S. Department of Energy’s Advanced Technology Vehicles Manufacturing Loan Program (the “DOE Loan”), and the strategic investment of $250 million from fund entities managed by Orion Resource Partners LP (collectively, “Orion”), for the development and construction of Phase 1 of the Project (the “Orion Investment”), including statements regarding satisfaction of draw down conditions on the DOE Loan and expected timing for first draw down on the DOE Loan; |
| • | expectations about the extent that the JV Transaction, DOE Loan, the Orion Investment and cash on hand would fund the development and construction of the Project on schedule or at all; |
| • | expectations and timing on the commencement of major construction and first production; |
| • | project de-risking initiatives; |
| • | expectations related to the construction build, job creation and nameplate capacity of the Project as well as other statements with respect to the Company’s future objectives and strategies to achieve these objectives, including the future prospects of the Company; |
| • | the estimated cash flow, capitalization and adequacy thereof for the Company; |
| • | the estimated costs of the development of the Project, including timing, progress, approach, continuity or change in plans, construction, commissioning, milestones, anticipated production and results thereof and expansion plans; |
| • | cost and expected benefits of the transloading terminal; |
| • | cost and expected benefit of the limestone quarry; |
| • | anticipated timing to resolve, and the expected outcome of, any complaints or claims made or that could be made concerning the permitting process in the U.S. for the Project; |
| • | the timely completion of environmental reviews and related consultations, and receipt or issuance of permits and approvals, in the U.S. for the Company’s development and resultant operations; |
| • | capital expenditures and programs; |
| • | estimates, and any change in estimates, of the mineral resources and mineral reserves at the Project; |
| • | development of mineral resources and mineral reserves; |
| • | the realization of mineral resources and mineral reserves estimates, including whether certain mineral resources will ever be developed into mineral reserves, and information and underlying assumptions related thereto; |
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| • | government regulation of mining operations and treatment under governmental and taxation regimes; the future price of commodities, including lithium; |
| • | the creation of a battery supply chain in the U.S. to support the electric vehicle market; |
| • | the timing and amount of future production, currency exchange and interest rates; |
| • | the Company’s ability to raise capital; |
| • | expected expenditures to be made by the Company on the Project; |
| • | statements relating to revised capital cost estimates; |
| • | ability to produce high purity battery-grade lithium products; |
| • | settlement of agreements related to the operation and sale of mineral production as well as contracts in respect of operations and inputs required in the course of production; |
| • | the timing, cost, quantity, capacity and product quality of production at the Project; |
| • | successful development of the Project, including successful results from the Company’s testing facility and third-party tests related thereto; |
| • | statements with respect to the expected economics of the Project, including capital costs, operating costs, sustaining capital requirements, after-tax net present value and internal rate of return, pricing assumptions, payback period, sensitivity analyses, net cash flows and life of mine; |
| • | anticipated job creation and the completion of the workforce hub; |
| • | the expectation that the National Construction Agreement (Project Labor Agreement) with North America’s Building Trades Unions for construction of Phase 1 of the Project will minimize construction risk, ensure availability of skilled labor, address the challenges associated with the Project’s remote location and be effective in prioritizing employment of local and regional skilled craft workers, including members of underrepresented communities; |
| • | the expected workforce development training program being prepared with Great Basin College; |
| • | the Company’s commitment to sustainable development, limiting the environmental impact at the Project and plans for phased reclamation during the life of mine including use benefits of growth media; |
| • | ability to achieve capital cost efficiencies; |
| • | anticipated use of any future proceeds and earnings related to the Project; |
| • | anticipated plans regarding the payment or non-payment of dividends; and |
| • | as well as other statements with respect to management’s beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. |
Forward-looking statements involve known and unknown risks, assumptions and other factors that may cause actual results or performance to differ materially. Forward-looking statements reflect the Company’s current views about future events, and while considered reasonable by the Company as of the date of this prospectus, are inherently subject to significant uncertainties and contingencies. Accordingly, there can be no certainty that they will accurately reflect actual results. Assumptions and other factors upon which such forward-looking statements is based include, without limitation:
| • | expectations regarding Phase 2 of the Project, including financing; |
| • | the ability of Lithium Nevada LLC (“LN”) to draw down on the DOE Loan on the anticipated timeline, or at all, and the absence of material adverse events affecting the Company during the construction of the Project; |
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| • | the ability of LN to satisfy all draw down conditions for the DOE Loan in a timely manner; |
| • | the ability of the Company to perform conditions and meet expectations regarding the Company’s financial resources and future prospects; |
| • | the ability to meet future objectives and priorities; |
| • | a cordial business relationship between the Company and third-party strategic and contractual partners; |
| • | the risk of tax liabilities as a result of the statutory plan of arrangement between the Company and Lithium Americas (Argentina) Corp. (the “Arrangement”) and general business and economic uncertainties and adverse market conditions; |
| • | the risk that the Arrangement may not be tax-free for income tax purposes and potential significant tax liabilities that the Company may be exposed to if the tax-deferred spinoff rules are not met; |
| • | the risk of tax indemnity obligations owed by the Company to Lithium Argentina AG (“Lithium Argentina”) following the Arrangement becoming payable, including as a result of events outside of the Company’s control; |
| • | the availability of equipment and facilities necessary to complete development and construction of the Project; |
| • | unforeseen technological and engineering problems; |
| • | changes in general economic and geopolitical conditions, including as a result of regulatory changes by the current U.S. presidential administration, higher interest rates, the rate of inflation, a potential economic recession and potential changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences on, among other things, the extractive resource industry, the green energy transition and the electric vehicle market; |
| • | uncertainties inherent to feasibility studies and mineral resource and mineral reserve estimates; |
| • | the mine processing facilities, based on the results of the testing facility and third-party tests, performing as expected; |
| • | the ability of the Company to secure sufficient additional financing, advance and develop the Project, and to produce battery-grade lithium; |
| • | the respective benefits and impacts of the Project when production operations commence; |
| • | settlement of agreements related to the operation and sale of mineral production as well as contracts in respect of operations and inputs required in the course of production; |
| • | the Company’s ability to operate in a safe and effective manner, and without material adverse impact from the effects of climate change or severe weather conditions; |
| • | uncertainties relating to receiving and maintaining mining, exploration, environmental and other permits or approvals in Nevada; |
| • | demand for lithium, including that such demand is supported by growth in the electric vehicle market and lithium-ion battery market; |
| • | current technological trends; |
| • | the impact of increasing competition in the lithium business, and the Company’s competitive position in the industry; |
| • | continuing support of local communities and the Fort McDermitt Paiute and the Shoshone Tribe in relation to the Project, and continuing constructive engagement with these and other stakeholders, and any expected benefits of such engagement; |
| • | risks related to cost, funding and regulatory authorizations to develop a workforce housing facility; |
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| • | the stable and supportive legislative, regulatory and community environment in the jurisdictions where the Company operates; |
| • | impacts of inflation, deflation, currency exchange rates, interest rates and other general economic and stock market conditions; |
| • | the impact of unknown financial contingencies, including litigation costs, environmental compliance costs and costs associated with the impacts of climate change, on the Company’s operations; |
| • | increased attention to environmental, social, governance and safety and sustainability-related matters; |
| • | risks related to the Company’s public statements with respect to such matters that may be subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing,” (i.e., misleading information or false claims overstating potential sustainability-related benefits); |
| • | risks that the Company may face regarding potentially conflicting initiatives from certain U.S. state or other governments; |
| • | estimates of, and unpredictable changes to, the market prices for lithium products; |
| • | development and construction costs for the Project, and costs for any additional exploration work at the project; |
| • | estimates of mineral resources and mineral reserves, including whether mineral resources not included in mineral reserves will be further developed into mineral reserves; |
| • | some of the modifying factors used to convert mineral resources to mineral reserves may change materially, and could materially impact the mineral reserve estimate; |
| • | reliability of technical data; |
| • | anticipated timing and results of exploration, development and construction activities, including the impact of ongoing supply chain disruptions and availability of equipment and supplies on such timing; |
| • | timely responses from governmental agencies responsible for reviewing and considering the Company’s permitting activities at the Project; |
| • | availability of technology, including low carbon energy sources and water rights, on acceptable terms to advance the Project; |
| • | government regulation of mining operations and mergers and acquisitions activity, and treatment under governmental, regulatory and taxation regimes; |
| • | ability to realize expected benefits from investments in or partnerships with third parties; accuracy of development budgets and construction estimates; |
| • | that the Company will meet its future objectives and priorities; |
| • | that the Company will have access to adequate capital to fund its future projects and plans; |
| • | that such future projects and plans will proceed as anticipated; |
| • | compliance by the JV Partners (as defined herein) with terms of agreements and the ability of the JV Partners to fund their share of funding obligations for the Project; |
| • | the lack of any material disputes or disagreements between the JV Partners; |
| • | the regulation of the mining industry by various governmental agencies; |
| • | as well as assumptions concerning general economic and industry growth rates, commodity prices, resource estimates, currency exchange and interest rates and competitive conditions. |
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Although the Company believes that the assumptions and expectations reflected in such forward-looking statements are reasonable, the Company can give no assurance that these assumptions and expectations will prove to be correct.
Readers are cautioned that the foregoing lists of factors are not exhaustive. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. As such, readers are cautioned not to place undue reliance on this information, and that this information may not be appropriate for any other purpose, including investment purposes. The Company’s actual results could differ materially from those anticipated in any forward-looking statements as a result of the risk factors set out herein, and in the Company’s other continuous disclosure documents available on EDGAR at www.sec.gov. All forward-looking statements contained in this prospectus is expressly qualified by the risk factors set out in the aforementioned documents. Readers are further cautioned to review the full description of risks, uncertainties and management’s assumptions in the aforementioned documents and other disclosure documents available on EDGAR. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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Our Company
We are a Canadian-based resource and materials company focused on developing, building and operating significant lithium deposits and chemical processing facilities. Our flagship asset is Thacker Pass, a sedimentary-based lithium deposit located in the McDermitt Caldera in Humboldt County, in northern Nevada (“Thacker Pass”). Thacker Pass is owned by LN, a wholly owned subsidiary of Lithium Nevada Ventures LLC (“Lithium Nevada Ventures”), the joint venture (“JV”) between General Motors Holdings LLC (“GM”) and the Company (together, the “JV Partners”). We own a 62% interest in Thacker Pass and will manage the Project, and GM owns a 38% interest in Thacker Pass.
Thacker Pass “Phase 1” refers to the anticipated initial phase of production, targeting 40,000 tonnes per year (“t/y”) of battery-grade lithium carbonate (“Li2CO3”), “Phase 2” refers to a possible second phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 3” refers to a possible third phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 4” refers to a possible fourth phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 5” refers to a fifth phase of development that would add an additional beneficiation circuit and sulfuric acid plant, without an additional Li2CO3 processing plant, for total planned production capacity of 160,000 t/y.
We also hold investments in Green Technology Metals Limited (“GT1”) and Ascend Elements, Inc. (“Ascend Elements”), and exploration properties in the U.S. and Canada.
Our Common Shares are listed on the NYSE and on the TSX under the symbol “LAC.”
Amounts stated in this prospectus are in United States dollars, unless otherwise indicated.
Company Information
Our principal executive offices are located at 3260 – 666 Burrard Street, Vancouver, BC V6C 2X8, and our telephone number is (778) 656-5820. Our website is www.lithiumamericas.com. The information found on our website is not part of this prospectus.
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An investment in our securities involves a high degree of risk. You should carefully consider those risk factors described under the heading “Risk Factors” in our most recent Annual Report on Form 10-K and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (other than, in each case, information furnished rather than filed), which are incorporated by reference herein, and those risk factors that may be included in any applicable prospectus supplement, together with all of the other information included in this prospectus, any prospectus supplement and the documents we incorporate by reference, in evaluating an investment in our securities. Our business, prospects, financial condition or operating results could be harmed by any of these risks, as well as other risks not currently known to us or that we currently consider immaterial. The trading price of our Common Shares could decline due to any of these risks, and, as a result, you may lose all or part of your investment. Before deciding whether to invest in our securities, you should also refer to the other information contained in or incorporated by reference into this prospectus, including the section entitled “Cautionary Note Regarding Forward-Looking Statements.”
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Except as otherwise provided in any applicable prospectus supplement, we intend to use the net proceeds we receive from the sale of securities for general corporate purposes, which may include funding of corporate and project overhead expenses, financing of capital expenditures, repayment of indebtedness and additions to working capital.
Any specific allocation of the net proceeds of an offering of securities to a specific purpose will be determined at the time of the offering and will be described in any applicable prospectus supplement.
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We may use one or more of the following methods when selling securities under this prospectus:
| • | underwritten transactions; |
| • | privately negotiated transactions; |
| • | exchange distributions and/or secondary distributions; |
| • | sales in the over-the-counter market; |
| • | ordinary brokerage transactions and transactions in which the broker solicits purchasers; |
| • | broker-dealers may agree with the selling shareholder to sell a specified number of such shares at a stipulated price per share; |
| • | a block trade (which may involve crosses) in which the broker or dealer so engaged will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction; |
| • | purchases by a broker or dealer as principal and resale by such broker or dealer for its own account pursuant to this prospectus; |
| • | short sales and delivery of our Common Shares to close out short positions; |
| • | sales by broker-dealers of our Common Shares that are loaned or pledged to such broker-dealers; |
| • | “at-the-market” offerings into an existing trading market in accordance with Rule 415(a)(4) under the Securities Act; |
| • | a combination of any such methods of sale; and |
| • | any other method permitted pursuant to applicable law. |
We may prepare prospectus supplements that will disclose the terms of the offering, including the name or names of any underwriters, dealers or agents, the purchase price of the securities, any underwriting discounts and other items constituting compensation to underwriters, dealers or agents.
We may fix a price or prices of our securities at:
| • | market prices prevailing at the time of any sale under this registration statement; |
| • | prices related to market prices; or |
| • | negotiated prices. |
We may change the price of the securities offered from time to time.
If we use underwriters in an offering, we will execute an underwriting agreement with such underwriters and will specify the name of each underwriter and the terms of the transaction (including any underwriting discounts and other terms constituting compensation of the underwriters and any dealers) in a prospectus supplement. If we use an underwriting syndicate, the managing underwriter(s) will be specified on the cover of the prospectus supplement. If we use underwriters for a sale of securities, the underwriters will acquire the securities for their own accounts. The underwriters may resell the securities from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. Any public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. Unless otherwise set forth in the prospectus supplement, the
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obligations of the underwriters to purchase the offered securities will be subject to conditions precedent and the underwriters will be obligated to purchase all of the offered securities if any are purchased.
If dealers are used in an offering, we may sell the securities to the dealers as principals. The dealers then may resell the securities to the public at varying prices which they determine at the time of resale. The names of the dealers and the terms of the transaction will be specified in a prospectus supplement.
If agents are used in an offering, the names of the agents and the terms of the agency will be specified in a prospectus supplement. Unless otherwise indicated in a prospectus supplement, the agents will act on a best-efforts basis for the period of their appointment.
Dealers and agents named in a prospectus supplement may be underwriters as defined in the Securities Act and any discounts or commissions they receive from us and any profit on their resale of the securities may be treated as underwriting discounts and commissions under the Securities Act. We will identify in the applicable prospectus supplement any underwriters, dealers or agents and will describe their compensation. We may enter into agreements with the underwriters, dealers and agents to indemnify them against specified civil liabilities, including liabilities under the Securities Act.
Underwriters, dealers or agents and their associates may engage in other transactions with and perform other services for us in the ordinary course of business.
If so indicated in a prospectus supplement, we will authorize underwriters or other persons acting as our agents to solicit offers by institutional investors to purchase securities pursuant to contracts providing for payment and delivery on a future date. We may enter contracts with commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and other institutional investors. The obligations of any institutional investor will be subject to the condition that its purchase of the offered securities will not be illegal at the time of delivery. The underwriters and other agents will not be responsible for the validity or performance of contracts.
In addition, we may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement so indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of stock. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be named in the applicable prospectus supplement (or a post-effective amendment).
In addition, we may otherwise loan or pledge securities to a financial institution or other third party that in turn may sell the securities short using this prospectus and an applicable prospectus supplement. Such financial institution or other third party may transfer its economic short position to investors in our securities or in connection with a concurrent offering of other securities.
The specific terms of any lock-up provisions in respect of any given offering will be described in any applicable prospectus supplement.
To the extent required, this prospectus may be amended or supplemented from time to time to describe a specific plan of distribution.
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The following summary of certain material provisions of our capital stock does not purport to be complete and is subject to and qualified by reference to our amended articles of incorporation (our “Articles”).
Common Shares
The Company is authorized to issue an unlimited number of Common Shares without par value of which, as at May 8, 2025, a total of 218,904,876 Common Shares are issued and outstanding. Holders of Common Shares are entitled to receive notice of and to attend all meetings of shareholders and to one vote in respect of each Common Share held at all such meetings. Subject to the rights of holders of any other class of shares of the Company entitled to receive dividends in priority, shareholders will be entitled to receive dividends if, as and when declared by the Board of Directors out of the assets of the Company properly applicable to the payment of dividends. In the event of the liquidation, dissolution or winding up of the Company or other distribution of assets of the Company among its shareholders for the purpose of winding up its affairs, shareholders will be entitled to all remaining property and assets of the Company on a share for share basis.
Other than the participation right held by GM and discussed in more detail below, the Common Shares are not subject to pre-emptive, redemption, purchase or conversion rights. There are no sinking fund provisions in relation to the Common Shares and they are not liable to further calls or assessment by the Company. The Business Corporations Act (British Columbia) (the “BCBCA”) and our Articles provide that the rights and restrictions attached to any class of shares may not be modified, amended or varied unless consented to by special resolution passed by not less than two-thirds of the votes cast in person or by proxy by holders of shares of that class.
The prospectus supplement may include a discussion of Canadian and U.S. federal income tax considerations applicable to the Common Shares.
GM Investor Rights Agreement
Under the Amended and Restated Investor Rights Agreement, dated October 15, 2024, between the Company and GM (the “Investor Rights Agreement”), GM has certain board nomination rights, oversight and demand registration and piggy-back registration rights and securities offering participation rights, and is also subject to certain standstill limitations pertaining to take-over bids (and similar transactions) until a period that ends on the earlier of (i) five years from the date of the reorganization resulting in the separation of the North American business and Argentinian business of Lithium Americas (Argentina) Corp. (formerly Lithium Americas Corp.) into two independent public companies (the “Separation”), and (ii) one year following the date of the commencement of commercial production for Phase 1 as outlined in the agreement to supply GM with Li2CO3 production from Thacker Pass (the “Offtake Agreement”).
Election of Directors
Directors are elected annually for a term of one year, as approved by the vote of shareholders entitled to vote at the annual general meeting for the election of directors, or in the unanimous resolution that appoints, such directors. All directors cease to hold office immediately before the election or appointment of such directors, but are eligible for re-election or re-appointment.
Dividends and Distributions
The Company has not paid any dividends since its incorporation and does not currently have a policy with respect to the payment of dividends. It is anticipated that the Company will not have a fixed dividend policy and will not declare any dividends on the Common Share for the immediate future; rather, all available funds of the
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Company will be kept as retained earnings to fund operations, used to undertake exploration and development programs on its mineral properties, and for the acquisition of additional mineral properties for the foreseeable future. Any future payment of dividends will depend, among other things, upon the Company’s earnings, capital requirements and operating and financial condition. Generally, dividends can only be paid if a corporation has retained earnings. There can be no assurance that the Company will generate sufficient earnings to allow it to pay dividends.
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DESCRIPTION OF PREFERRED SHARES
The particular class of preferred shares and the particular terms and provisions of any series of such class of preferred shares offered by any prospectus supplement will be described in the prospectus supplement filed in respect of such series of preferred shares. The prospectus supplement may include a discussion of Canadian and U.S. federal income tax considerations applicable to the preferred shares.
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INVESTMENT IN LITHIUM AMERICAS CORP. BY EMPLOYEE BENEFIT PLANS
The purchase or holding of our Common Shares by an “employee benefit plan” (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”)), an individual retirement account (“IRA”), or any entity whose assets include the assets of such plans or arrangements (collectively, “Plans”) is subject to ERISA, Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”), and, in some cases, to provisions under federal, state, local, non-U.S. or other laws that impose rules similar to ERISA or the Code (“Similar Laws”). Under these rules, fiduciaries of a Plan must, among other things, ensure that any investment in our Common Shares is prudent, complies with the Plan’s governing documents, is properly diversified, will not result in the recognition of unrelated business taxable income and, most importantly, will not constitute a “prohibited transaction” with a “party in interest” or “disqualified person” (as those terms are defined in ERISA and the Code, respectively). Statutory, class or individual exemptions may be available to address these concerns, but no assurance can be given that all of the conditions of any such exemptions will be satisfied.
In addition, a Plan that acquires our Common Shares could, in certain circumstances, be deemed to hold an undivided interest in our underlying assets (“plan assets”), thereby subjecting our operations to ERISA’s fiduciary and prohibited-transaction rules. The U.S. Department of Labor’s “plan asset” regulation, as modified by ERISA Section 3(42), generally avoids this result if: (i) the Common Shares qualify as “publicly-offered securities” (widely held, freely transferable and either part of a public offering or registered under the Securities Act), (ii) we qualify as an “operating company,” or (iii) less than 25% of the value of any class of our equity interests is held by “benefit plan investors.” While we expect one or more of these exceptions to apply, we cannot guarantee that will be the case.
Accordingly, each person acquiring or holding our Common Shares will be deemed to have represented that (a) it is not, and for so long as it holds the Common Shares will not be, using assets of any Plan subject to ERISA, the Code or Similar Laws, or (b) its purchase and continued holding of the Common Shares will not result in a non-exempt prohibited transaction or similar violation under any applicable Similar Laws. Fiduciaries considering an investment in the Common Shares should consult their own legal advisors regarding the consequences under ERISA, the Code and any Similar Laws, and the availability of exemptive relief.
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The validity of our Common Shares offered by this prospectus will be passed upon for us by Cassels Brock & Blackwell LLP, Toronto, Ontario. Certain legal matters in connection with this offering will be passed upon for us by Vinson & Elkins L.L.P., Houston, Texas.
The financial statements incorporated in this prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2024, have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in audit and accounting.
The estimates of mineral resources and mineral reserves and related information of the Project incorporated by reference herein are based upon analyses contained in the S-K 1300 Technical Report Summary for the Thacker Pass Project Humboldt County, Nevada, USA (the “S-K 1300 Technical Report”), with an effective date of December 31, 2024, and performed by SGS Canada Inc., Sawtooth Mining LLC, NewFields Mining Design & Technical Services, and EXP U.S. Services Inc. Such estimates and related information have been so incorporated in reliance upon the authority of such firms as experts in such matters.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on Form S-3 (including the exhibits, schedules and amendments thereto) under the Securities Act, with respect to the shares of our securities offered hereby. This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules thereto. For further information with respect to us and the securities offered hereby, we refer you to the registration statement and the exhibits and schedules filed therewith. Statements contained in this prospectus as to the contents of any contract, agreement or any other document are summaries of the material terms of such contract, agreement or other document and are not necessarily complete. With respect to each of these contracts, agreements or other documents filed as an exhibit to the registration statement, reference is made to the exhibits for a more complete description of the matter involved.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. Our registration statement, of which this prospectus constitutes a part, and the exhibits and schedules thereto can be downloaded from the SEC’s website. We file with or furnish to the SEC periodic reports and other information. These reports and other information may be obtained from the SEC’s website as provided above. Our website is located at www.lithiumamericas.com. We make our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports and other information filed with or furnished to the SEC available, free of charge, through our website, as soon as reasonably practicable after those reports and other information are electronically filed with or furnished to the SEC. Information on our website or any other website is not incorporated by reference into this prospectus and does not constitute a part of this prospectus, and investors should not rely on such information in making a decision to purchase our securities.
We furnish or make available to our shareholders annual reports containing our audited financial statements prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). We also furnish or make available to our shareholders quarterly reports containing our unaudited interim financial information, including the information required by Form 10-Q, for the first three fiscal quarters of each fiscal year.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
We “incorporate by reference” into this prospectus documents we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus. Some information contained in this prospectus updates the information incorporated by reference, and information that we file subsequently with the SEC will automatically update this prospectus. In other words, in the case of a conflict or inconsistency between information set forth in this prospectus and information that we file later and incorporate by reference into this prospectus, you should rely on the information contained in the document that was filed later.
In particular, we incorporate by reference into this prospectus the documents listed below and any filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the initial filing and prior to effectiveness of the registration statement that contains this prospectus and prior to the time that all the Common Shares offered by this prospectus have been sold by the selling shareholder as described in this prospectus (other than, in each case, documents or information deemed to have been “furnished” and not “filed” in accordance with SEC rules) or such registration statement has been withdrawn:
| • | our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 28, 2025; |
| • | our Quarterly Report on Form 10-Q for the period ended March 31, 2025, filed with the SEC on May 15, 2025; |
| • | our Current Reports on Form 8-K, filed on January 7, 2025, January 7, 2025, March 11, 2025, March 28, 2025, and April 7, 2025 (except that, with respect to each of the foregoing Current Reports, any portion thereof which are furnished and not filed shall not be deemed incorporated by reference into this prospectus); and |
| • | the description of the Common Shares contained in our Registration Statement on Form 20-F, filed with the SEC on August 22, 2023, as amended, and declared effective by the SEC on September 28, 2023, including any amendment or report filed for the purpose of amending such description. |
Any statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus will be deemed to be modified or superseded to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference in this prospectus modifies or supersedes that statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
You may request a copy of the registration statement, the above filings and any future filings that are incorporated by reference into this prospectus, other than an exhibit to a filing unless that exhibit is specifically incorporated by reference into that filing, at no cost, by writing or calling us at the following address:
3260 – 666, Burrard Street
Vancouver, BC V6C 2X8
(778) 656-5820
Attention: Investor Relations
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Lithium Americas Corp.
$1,000,000,000
Common Shares
Preferred Shares
PROSPECTUS
, 2025
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The information in this prospectus is not complete and may be changed. The selling shareholder may not sell the Common Shares until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This prospectus is not an offer to sell the Common Shares and is not soliciting an offer to buy the Common Shares in any jurisdiction where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED MAY 15, 2025
PRELIMINARY PROSPECTUS
Lithium Americas Corp.
43,707,080 Common Shares Offered by the Selling Shareholder
This prospectus relates to the offer and sale by the selling shareholder of up to an aggregate 43,707,080 Common Shares of the Company.
Such Common Shares are issuable upon the conversion of a convertible promissory note (the “Convertible Note”) issued and sold to an affiliate of Orion Resource Partners LP (“Orion”) at the closing of the Orion Investment. The Convertible Note is convertible into Common Shares, subject to certain conditions and limitations. We sold the Convertible Note in a transaction exempt from the registration requirements of the Securities Act, pursuant to a Transaction Agreement, dated as of March 5, 2025, with Orion (the “Transaction Agreement”). We are registering the resale of the Common Shares issuable upon conversion of the Convertible Note as required by the Registration Rights Agreement, dated as of April 1, 2025, that we entered into with Orion concurrently with the issuance of the Convertible Note.
This prospectus provides you with a general description of the Common Shares offered hereby and the general manner in which the selling shareholder, upon conversion of the Convertible Note, may offer such securities. More specific terms of any securities that the selling shareholder offer may be provided in a prospectus supplement, if required, that describes, among other things, the specific amounts and prices of the securities being offered and the terms of the offering. The prospectus supplement may also add, update or change information contained in this prospectus.
We will not receive any proceeds from the sale of Common Shares to be offered by the selling shareholder. However, we will pay certain expenses, other than underwriting discounts and commissions, associated with the sale of Common Shares by the selling shareholder pursuant to this prospectus. Our registration of the Common Shares covered by this prospectus does not mean that the selling shareholder will offer or sell any of the Common Shares. The selling shareholder may sell the Common Shares covered by this prospectus in a number of different ways and at varying prices. We provide more information about how the selling shareholder may sell the Common Shares in the section entitled “Plan of Distribution.”
Our Common Shares are traded on the NYSE and the TSX under the symbol “LAC.” The closing price for our Common Shares on May 14, 2025, was US$3.08 per share, as reported on the NYSE and was C$4.32 per share, as reported on the TSX.
Investing in our Common Shares involves risks. See “Risk Factors” beginning on page 8.
Neither the SEC nor any state securities commission has approved or disapproved of the Common Shares or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2025.
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Neither we nor the selling shareholder have authorized anyone to provide any information or to make any representations other than those contained or incorporated by reference in this prospectus, any accompanying prospectus supplement or any free writing prospectus we have prepared. We and the selling shareholder take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the Common Shares offered hereby and only under circumstances and in jurisdictions where it is lawful to do so. The information contained or incorporated by reference in this prospectus is current only as of its date.
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This prospectus is part of a registration statement on Form S-3 that we filed with the SEC using a “shelf” registration process. Under this shelf registration process, the selling shareholder may, from time to time, offer and sell any combination of the Common Shares described in this prospectus in one or more offerings. This prospectus generally describes Lithium Americas Corp. and its securities, including its Common Shares. The selling shareholder may use the shelf registration statement to sell up to an aggregate of 43,707,080 Common Shares from time to time through any means described in the section entitled “Plan of Distribution.”
We will not receive any proceeds from the sale of the Common Shares to be offered by the selling shareholder. However, we will pay certain expenses, other than underwriting discounts and commissions, associated with the sale of Common Shares by the selling shareholder pursuant to this prospectus. More specific terms of any shares of the Common Shares that the selling shareholder offers may be provided in a prospectus supplement, if required, that describes, among other things, the specific amounts and prices of the Common Shares being offered and the terms of the offering. The prospectus supplement may also add, update or change information included in this prospectus. You should read both this prospectus and any applicable prospectus supplement, together with additional information described below under the captions “Where You Can Find More Information” and “Incorporation of Certain Information by Reference.”
No offer of the Common Shares will be made in any jurisdiction where the offer is not permitted.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
The information in this prospectus contains or incorporates by reference information that includes or is based upon “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements, other than statements of historical facts, are forward-looking statements and can be identified by the use of statements that include, but are not limited to, words, such as “anticipate,” “plan,” “continue,” “estimate,” “expect,” “may,” “will,” “project,” “predict,” “proposes,” “potential,” “target,” “implement,” “schedule,” “forecast,” “intend,” “would,” “could,” “might,” “should,” “believe” and similar terminology, or statements that certain actions, events or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved. Forward-looking statements in this prospectus, including the documents incorporated by reference, includes, but is not limited to:
| • | statements relating to the anticipated sources and uses of funds to complete project financing, statements relating to the JV Transaction with GM, the DOE Loan and the Orion Investment, including statements regarding satisfaction of draw down conditions on the DOE Loan and expected timing for first draw down on the DOE Loan; |
| • | expectations about the extent that the JV Transaction, DOE Loan, the Orion Investment and cash on hand would fund the development and construction of the Project on schedule or at all; |
| • | expectations and timing on the commencement of major construction and first production; |
| • | project de-risking initiatives; |
| • | expectations related to the construction build, job creation and nameplate capacity of the Project as well as other statements with respect to the Company’s future objectives and strategies to achieve these objectives, including the future prospects of the Company; |
| • | the estimated cash flow, capitalization and adequacy thereof for the Company; |
| • | the estimated costs of the development of the Project, including timing, progress, approach, continuity or change in plans, construction, commissioning, milestones, anticipated production and results thereof and expansion plans; |
| • | cost and expected benefits of the transloading terminal; |
| • | cost and expected benefit of the limestone quarry; |
| • | anticipated timing to resolve, and the expected outcome of, any complaints or claims made or that could be made concerning the permitting process in the U.S. for the Project; |
| • | the timely completion of environmental reviews and related consultations, and receipt or issuance of permits and approvals, in the U.S. for the Company’s development and resultant operations; |
| • | capital expenditures and programs; |
| • | estimates, and any change in estimates, of the mineral resources and mineral reserves at the Project; |
| • | development of mineral resources and mineral reserves; |
| • | the realization of mineral resources and mineral reserves estimates, including whether certain mineral resources will ever be developed into mineral reserves, and information and underlying assumptions related thereto; |
| • | government regulation of mining operations and treatment under governmental and taxation regimes; the future price of commodities, including lithium; |
| • | the creation of a battery supply chain in the U.S. to support the electric vehicle market; |
| • | the timing and amount of future production, currency exchange and interest rates; |
| • | the Company’s ability to raise capital; |
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| • | expected expenditures to be made by the Company on the Project; |
| • | statements relating to revised capital cost estimates; |
| • | ability to produce high purity battery-grade lithium products; |
| • | settlement of agreements related to the operation and sale of mineral production as well as contracts in respect of operations and inputs required in the course of production; |
| • | the timing, cost, quantity, capacity and product quality of production at the Project; |
| • | successful development of the Project, including successful results from the Company’s testing facility and third-party tests related thereto; |
| • | statements with respect to the expected economics of the Project, including capital costs, operating costs, sustaining capital requirements, after-tax net present value and internal rate of return, pricing assumptions, payback period, sensitivity analyses, net cash flows and life of mine; |
| • | anticipated job creation and the completion of the workforce hub; |
| • | the expectation that the National Construction Agreement (Project Labor Agreement) with North America’s Building Trades Unions for construction of Phase 1 of the Project will minimize construction risk, ensure availability of skilled labor, address the challenges associated with the Project’s remote location and be effective in prioritizing employment of local and regional skilled craft workers, including members of underrepresented communities; |
| • | the expected workforce development training program being prepared with Great Basin College; |
| • | the Company’s commitment to sustainable development, limiting the environmental impact at the Project and plans for phased reclamation during the life of mine including use benefits of growth media; |
| • | ability to achieve capital cost efficiencies; |
| • | anticipated use of any future proceeds and earnings related to the Project; |
| • | anticipated plans regarding the payment or non-payment of dividends; and |
| • | as well as other statements with respect to management’s beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. |
Forward-looking statements involve known and unknown risks, assumptions and other factors that may cause actual results or performance to differ materially. Forward-looking statements reflect the Company’s current views about future events, and while considered reasonable by the Company as of the date of this prospectus, are inherently subject to significant uncertainties and contingencies. Accordingly, there can be no certainty that they will accurately reflect actual results. Assumptions and other factors upon which such forward-looking statements is based include, without limitation:
| • | expectations regarding Phase 2 of the Project, including financing; |
| • | the ability of LN to draw down on the DOE Loan on the anticipated timeline, or at all, and the absence of material adverse events affecting the Company during the construction of the Project; |
| • | the ability of LN to satisfy all draw down conditions for the DOE Loan in a timely manner; |
| • | the ability of the Company to perform conditions and meet expectations regarding the Company’s financial resources and future prospects; |
| • | the ability to meet future objectives and priorities; |
| • | a cordial business relationship between the Company and third-party strategic and contractual partners; |
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| • | the risk of tax liabilities as a result of the Arrangement and general business and economic uncertainties and adverse market conditions; |
| • | the risk that the Arrangement may not be tax-free for income tax purposes and potential significant tax liabilities that the Company may be exposed to if the tax-deferred spinoff rules are not met; |
| • | the risk of tax indemnity obligations owed by the Company to Lithium Argentina following the Arrangement becoming payable, including as a result of events outside of the Company’s control; |
| • | the availability of equipment and facilities necessary to complete development and construction of the Project; |
| • | unforeseen technological and engineering problems; |
| • | changes in general economic and geopolitical conditions, including as a result of regulatory changes by the current U.S. presidential administration, higher interest rates, the rate of inflation, a potential economic recession and potential changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences on, among other things, the extractive resource industry, the green energy transition and the electric vehicle market; |
| • | uncertainties inherent to feasibility studies and mineral resource and mineral reserve estimates; |
| • | the mine processing facilities, based on the results of the testing facility and third-party tests, performing as expected; |
| • | the ability of the Company to secure sufficient additional financing, advance and develop the Project, and to produce battery-grade lithium; |
| • | the respective benefits and impacts of the Project when production operations commence; |
| • | settlement of agreements related to the operation and sale of mineral production as well as contracts in respect of operations and inputs required in the course of production; |
| • | the Company’s ability to operate in a safe and effective manner, and without material adverse impact from the effects of climate change or severe weather conditions; |
| • | uncertainties relating to receiving and maintaining mining, exploration, environmental and other permits or approvals in Nevada; |
| • | demand for lithium, including that such demand is supported by growth in the electric vehicle market and lithium-ion battery market; |
| • | current technological trends; |
| • | the impact of increasing competition in the lithium business, and the Company’s competitive position in the industry; |
| • | continuing support of local communities and the Fort McDermitt Paiute and the Shoshone Tribe in relation to the Project, and continuing constructive engagement with these and other stakeholders, and any expected benefits of such engagement; |
| • | risks related to cost, funding and regulatory authorizations to develop a workforce housing facility; |
| • | the stable and supportive legislative, regulatory and community environment in the jurisdictions where the Company operates; |
| • | impacts of inflation, deflation, currency exchange rates, interest rates and other general economic and stock market conditions; |
| • | the impact of unknown financial contingencies, including litigation costs, environmental compliance costs and costs associated with the impacts of climate change, on the Company’s operations; |
| • | increased attention to environmental, social, governance and safety and sustainability-related matters; |
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| • | risks related to the Company’s public statements with respect to such matters that may be subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing,” (i.e., misleading information or false claims overstating potential sustainability-related benefits); |
| • | risks that the Company may face regarding potentially conflicting initiatives from certain U.S. state or other governments; |
| • | estimates of, and unpredictable changes to, the market prices for lithium products; |
| • | development and construction costs for the Project, and costs for any additional exploration work at the project; |
| • | estimates of mineral resources and mineral reserves, including whether mineral resources not included in mineral reserves will be further developed into mineral reserves; |
| • | some of the modifying factors used to convert mineral resources to mineral reserves may change materially, and could materially impact the mineral reserve estimate; |
| • | reliability of technical data; |
| • | anticipated timing and results of exploration, development and construction activities, including the impact of ongoing supply chain disruptions and availability of equipment and supplies on such timing; |
| • | timely responses from governmental agencies responsible for reviewing and considering the Company’s permitting activities at the Project; |
| • | availability of technology, including low carbon energy sources and water rights, on acceptable terms to advance the Project; |
| • | government regulation of mining operations and mergers and acquisitions activity, and treatment under governmental, regulatory and taxation regimes; |
| • | ability to realize expected benefits from investments in or partnerships with third parties; accuracy of development budgets and construction estimates; |
| • | that the Company will meet its future objectives and priorities; |
| • | that the Company will have access to adequate capital to fund its future projects and plans; |
| • | that such future projects and plans will proceed as anticipated; |
| • | compliance by the JV Partners with terms of agreements and the ability of the JV Partners to fund their share of funding obligations for the Project; |
| • | the lack of any material disputes or disagreements between the JV Partners; |
| • | the regulation of the mining industry by various governmental agencies; |
| • | as well as assumptions concerning general economic and industry growth rates, commodity prices, resource estimates, currency exchange and interest rates and competitive conditions. |
Although the Company believes that the assumptions and expectations reflected in such forward-looking statements are reasonable, the Company can give no assurance that these assumptions and expectations will prove to be correct.
Readers are cautioned that the foregoing lists of factors are not exhaustive. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. As such, readers are cautioned not to place undue reliance on this information, and that this information may not be appropriate for any other purpose, including investment purposes. The Company’s actual results could differ materially from those anticipated in any forward-looking
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statements as a result of the risk factors set out herein, and in the Company’s other continuous disclosure documents available on EDGAR at www.sec.gov. All forward-looking statements contained in this prospectus is expressly qualified by the risk factors set out in the aforementioned documents. Readers are further cautioned to review the full description of risks, uncertainties and management’s assumptions in the aforementioned documents and other disclosure documents available on EDGAR. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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Our Company
We are a Canadian-based resource and materials company focused on developing, building and operating significant lithium deposits and chemical processing facilities. Our flagship asset is Thacker Pass. Thacker Pass is owned by LN, a wholly owned subsidiary of Lithium Nevada Ventures, the JV between the JV Partners. We own a 62% interest in Thacker Pass and will manage the Project, and GM owns a 38% interest in Thacker Pass.
Thacker Pass “Phase 1” refers to the anticipated initial phase of production, targeting 40,000 t/y of battery-grade Li2CO3, “Phase 2” refers to a possible second phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 3” refers to a possible third phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 4” refers to a possible fourth phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 5” refers to a fifth phase of development that would add an additional beneficiation circuit and sulfuric acid plant, without an additional Li2CO3 processing plant, for total planned production capacity of 160,000 t/y.
We also hold investments in GT1 and Ascend Elements, and exploration properties in the U.S. and Canada.
Our Common Shares are listed on the NYSE and on the TSX under the symbol “LAC.”
Amounts stated in this prospectus are in United States dollars, unless otherwise indicated.
Company Information
Our principal executive offices are located at 3260 – 666 Burrard Street, Vancouver, BC V6C 2X8, and our telephone number is (778) 656-5820. Our website is www.lithiumamericas.com. The information found on our website is not part of this prospectus.
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An investment in our securities involves a high degree of risk. You should carefully consider those risk factors described under the heading “Risk Factors” in our most recent Annual Report on Form 10-K and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (other than, in each case, information furnished rather than filed), which are incorporated by reference herein, and those risk factors that may be included in any applicable prospectus supplement, together with all of the other information included in this prospectus, any prospectus supplement and the documents we incorporate by reference, in evaluating an investment in our securities. Our business, prospects, financial condition or operating results could be harmed by any of these risks, as well as other risks not currently known to us or that we currently consider immaterial. The trading price of our Common Shares could decline due to any of these risks, and, as a result, you may lose all or part of your investment. Before deciding whether to invest in our securities, you should also refer to the other information contained in or incorporated by reference into this prospectus, including the section entitled “Cautionary Note Regarding Forward-Looking Statements.”
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We will not receive any proceeds from the sale of the Common Shares offered under this prospectus. Any proceeds from the sale of Common Shares under this prospectus will be received by the selling shareholder. However, pursuant to the Registration Rights Agreement, dated April 1, 2025, by and among the Company and each of the Holders set forth on the signature pages thereto (the “Registration Rights Agreement”), we will pay certain expenses, other than underwriting discounts and commissions, associated with the sale of Common Shares by the selling shareholder pursuant to this prospectus.
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Beneficial Ownership
Up to 43,707,080 Common Shares may be offered for resale by the selling shareholder under this prospectus.
In connection with the Closing of the Orion Investment, on April 1, 2025 (the “Issuance Date”), the Company issued to an affiliate of Orion Resource Partners LP (the “Investor”) the Convertible Note in the total original principal amount of $195 million. The Convertible Note is convertible into Common Shares, subject to certain conditions and limitations.
The Convertible Note provides a conversion right that allows the holder, at any time after the Issuance Date, to convert all or any portion of the principal amount of the Convertible Note, together with any accrued and unpaid interest (together, the “Conversion Amount”), into Common Shares at an initial conversion price of $3.78 per Common Share, subject to adjustment in accordance with the terms of the Convertible Note (the “Conversion Price”). The holder of the Convertible Note shall not have the right to any Common Shares otherwise issuable under the Convertible Note to the extent that any such issuance would result in (i) the holder of the Convertible Note (together with any future holder, collectively, the “Convertible Noteholder”) and its affiliates, if acting as a group and required to aggregate their beneficial ownership of Common Shares pursuant to Section 13(d) of the Exchange Act, owning more than 9.99% of the issued and outstanding Common Shares at the time of the conversion, subject to a potential increase to a 19.99% cap pursuant to certain notice requirements (the “Beneficial Ownership Limitation”) or (ii) the Convertible Noteholder holding more than the lesser of (a) 19.99% of the issued and outstanding Common Shares as of immediately prior to entry into the Transaction Agreement and (b) 19.99% of the issued and outstanding Common Shares at the time of conversion (the “Conversion Cap”). As a result of the Conversion Cap, the Convertible Note has a maximum Conversion Amount of 43,707,080 Common Shares. In accordance with the terms of the Registration Rights Agreement, this prospectus covers the resale of the maximum number of Common Shares issuable upon conversion of the Convertible Note without regard to any limitations on the conversion of such Convertible Note, including the Beneficial Ownership Limitation.
The following table sets forth the number of Common Shares being offered by the selling shareholder, including its donees, pledgees, transferees or other successors-in-interest, subject to the transfer restrictions described in this prospectus and the documents incorporated by reference herein, based on the assumptions that: (i) all shares registered for sale by this registration statement will be sold by or on behalf of the selling shareholder and (ii) no other Common Shares will be acquired prior to completion of this offering by the selling shareholder. The following table also sets forth the number of shares known to us, based upon information furnished by, or on behalf of, the selling shareholder, to be beneficially owned by the selling shareholder as of May 13, 2025, assuming the full conversion of the Convertible Note on that date and without regard to any limits on conversion, including the Beneficial Ownership Limitation. The selling shareholder is not making any representation that any shares covered by this prospectus will be offered for sale. The selling shareholder reserves the right to accept or reject, in whole or in part, any proposed sale of the shares.
Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to Common Shares and the right to acquire such voting or investment power within 60 days through the exercise of any option, warrant or other right. Unless otherwise indicated below, to our knowledge, all persons named in the table have sole voting and investment power with respect to the Common Shares beneficially owned by them. Except as described in the footnotes to the following table and under “Material Relationships with Selling Shareholders” below, none of the persons named in the table has held any position or office or had any other material relationship with us or our affiliates during the three years prior to the date of this prospectus. The inclusion of any Common Shares in this table does not constitute an admission of beneficial ownership for the person named below.
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Holders of our Common Shares vote together as a single class. As of May 8, 2025, we had (i) 218,904,876 Common Shares outstanding and (ii) $195 million in principal amount of the Convertible Note outstanding, which is convertible into 43,707,080 Common Shares at the option of the holder of such note, subject to the Beneficial Ownership Limitation. The percentages in the table below assume the full conversion of the Convertible Note without regard for to any limits on conversion, including the Beneficial Ownership Limitation.
| Shares Beneficially Owned Before the Offering |
Shares Beneficially Owned After the Offering |
|||||||||||||||||||
| Selling shareholder: |
Common Shares |
Voting Power(1) |
Number of Common Shares that may be sold hereby(2) |
Common Shares |
Voting Power(1) |
|||||||||||||||
| OMF Fund IV SPV M LLC (3) |
43,707,080 | 16.64 | % | 43,707,080 | — | — | ||||||||||||||
| (1) | Represents percentage of voting power of our Common Shares. |
| (2) | Represents the number of shares being registered on behalf of the selling shareholder pursuant to this registration statement, which may be less than the total number of shares held by the selling shareholder. |
| (3) | Represents Common Shares issuable upon conversion of the Convertible Note that are beneficially owned by OMF Fund IV SPV M LLC. The Common Shares are directly owned by Oskar Lewnowski, who is the managing member of OMFM GP LLC, which is a wholly owned subsidiary of Orion Mine Finance Management LP, which is a wholly owned subsidiary of OMF Fund IV SPV M LLC. The Common Shares are subject to a beneficial ownership limitation of 9.99%, which restricts the Selling Shareholder from converting that portion of the Convertible Note that would result in the Selling Shareholder and its affiliates owning, after conversion, a number of Common Shares in excess of the Beneficial Ownership Limitation. The business address of OMF Fund IV SPV M LLC is 7 Bryant Park, 25th Floor, 1045 Avenue of the Americas, New York, NY 10018. |
Material Relationships with Selling Shareholders
Our material relationship with the selling shareholder and its affiliates are set forth in our Current Report on Form 8-K filed on April 7, 2025, which is incorporated herein by reference.
Any applicable prospectus supplement, amendment or other permissible disclosure document will also disclose whether the selling shareholder has held any position or office with, has been employed by or otherwise has had a material relationship with us during the three years prior to the date of the prospectus supplement.
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The Common Shares are being registered to permit the selling shareholder to offer and sell such shares from time to time after the date of this prospectus. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. We will not receive any of the proceeds from the offering by the selling shareholder of the Common Shares offered under this prospectus. We will bear the fees and expenses incurred by us in connection with our obligation to register the Common Shares pursuant to the Registration Rights Agreement. If the shares are sold through underwriters or broker-dealers, we will not be responsible for underwriting discounts or commissions or agents’ commissions.
The selling shareholder may use any one or more of the following methods when disposing of the Common Shares pursuant to this prospectus or interests therein:
| • | on the NYSE, TSX or any national securities exchange or quotation service on which the Common Shares may be listed or quoted at the time of sale; |
| • | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
| • | block trades in which the broker-dealer will attempt to sell the Common Shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction; |
| • | purchases by a broker-dealer as principal and resale by the broker-dealer for its account; |
| • | an exchange distribution in accordance with the rules of the applicable exchange; |
| • | privately negotiated transactions; |
| • | in underwritten transactions; |
| • | distributions to members, general partners and limited partners; |
| • | short sales effected after the date the registration statement of which this prospectus is a part becomes effective; |
| • | through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
| • | broker-dealers may agree with the selling shareholder to sell a specified number of such Common Shares at a stipulated price per security; and |
| • | a combination of any such methods of sale or by any other legally available means. |
In addition, any Common Shares that qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than pursuant to this prospectus.
The selling shareholder may, from time to time, pledge or grant a security interest in some or all of the Common Shares owned by it and, if the selling shareholder defaults in the performance of its secured obligations, the pledgees or secured parties may offer and sell the shares, from time to time, under this prospectus, or under an amendment or supplement to this prospectus amending the list of the selling shareholder to include the pledgee, transferee or other successors in interest as the selling shareholders under this prospectus. In connection with the sale of our Common Shares or interests therein, the selling shareholder may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of our Common Shares in the course of hedging the positions they assume.
The selling shareholder may also sell our Common Shares short and deliver these securities to close out its short positions, or loan or pledge our Common Shares to broker-dealers that in turn may sell these securities. The selling shareholder may also enter into option or other transactions with broker-dealers or other financial
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institutions or one or more derivative securities that require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction). The selling shareholder also may transfer the Common Shares in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling shareholders for purposes of this prospectus. The number of Common Shares beneficially owned by the selling shareholder will decrease as and when it transfers its securities or defaults in performing obligations secured by such shares. The plan of distribution for the Common Shares offered and sold under this prospectus will otherwise remain unchanged, except that the transferees, distributees, pledgees, affiliates, other secured parties or other successors in interest will be selling shareholders for purposes of this prospectus.
The aggregate proceeds to the selling shareholder from the sale of the Common Shares will be the purchase price of the Common Shares less discounts and commissions, if any.
In offering the Common Shares covered by this prospectus, the selling shareholder and any broker-dealers who execute sales for the selling shareholder may be deemed to be “underwriters” within the meaning of Section 2(a)(11) of the Securities Act in connection with such sales. Any profits realized by the selling shareholder and the compensation of any broker-dealer may be deemed to be underwriting discounts and commissions. If the selling shareholder is an “underwriter” within the meaning of Section 2(a)(11) of the Securities Act, the selling shareholder will be subject to the prospectus delivery requirements of the Securities Act and may be subject to certain statutory and regulatory liabilities, including liabilities imposed pursuant to Sections 11, 12 and 17 of the Securities Act and Rule 10b-5 under the Exchange Act.
To the extent required, the Common Shares to be sold, the name of the selling shareholder, the respective purchase prices and public offering prices, the names of any agents, dealer or underwriter, any applicable commissions or discounts with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement that includes this prospectus.
Under the securities laws of some states, if applicable, the Common Shares registered hereby may be sold in those states only through registered or licensed brokers or dealers. In addition, in some states such Common Shares may not be sold unless they have been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied with.
The selling shareholder is subject to the applicable provisions of the Exchange Act, and the rules and regulations under the Exchange Act, including Regulation M. This regulation may limit the timing of purchases and sales of any of the Common Shares offered in this prospectus by the selling shareholder. The anti-manipulation rules under the Exchange Act may apply to sales of securities in the market and to the activities of the selling shareholder and its affiliates. Furthermore, Regulation M may restrict the ability of any person engaged in the distribution of the shares to engage in market-making activities for the particular securities being distributed for a period of up to five business days before the distribution. The restrictions may affect the marketability of our Common Shares and the ability of any person or entity to engage in market-making activities for the Common Shares.
We cannot assure you that the selling shareholder will sell all or any portion of the Common Shares registered pursuant to this registration statement. The selling shareholder may have agreements with underwriters, dealers and agents to indemnify it against certain civil liabilities, including liabilities under the Securities Act, and to reimburse it for certain expenses.
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The following summary of certain material provisions of our capital stock does not purport to be complete and is subject to and qualified by reference to our Articles.
Common Shares
The Company is authorized to issue an unlimited number of Common Shares without par value of which, as at May 8, 2025, a total of 218,904,876 Common Shares are issued and outstanding. Holders of Common Shares are entitled to receive notice of and to attend all meetings of shareholders and to one vote in respect of each Common Share held at all such meetings. Subject to the rights of holders of any other class of shares of the Company entitled to receive dividends in priority, shareholders will be entitled to receive dividends if, as and when declared by the Board of Directors out of the assets of the Company properly applicable to the payment of dividends. In the event of the liquidation, dissolution or winding up of the Company or other distribution of assets of the Company among its shareholders for the purpose of winding up its affairs, shareholders will be entitled to all remaining property and assets of the Company on a share for share basis.
Other than the participation right held by GM and discussed in more detail below, the Common Shares are not subject to pre-emptive, redemption, purchase or conversion rights. There are no sinking fund provisions in relation to the Common Shares and they are not liable to further calls or assessment by the Company. The BCBCA and our Articles provide that the rights and restrictions attached to any class of shares may not be modified, amended or varied unless consented to by special resolution passed by not less than two-thirds of the votes cast in person or by proxy by holders of shares of that class.
GM Investor Rights Agreement
GM has certain board nomination rights, oversight and demand registration and piggy-back registration rights and securities offering participation rights, and is also subject to certain standstill limitations pertaining to take-over bids (and similar transactions) until a period that ends on the earlier of (i) five years from the date of the Separation, and (ii) one year following the date of the commencement of commercial production for Phase 1 as outlined in the Offtake Agreement.
Election of Directors
Directors are elected annually for a term of one year, as approved by the vote of shareholders entitled to vote at the annual general meeting for the election of directors, or in the unanimous resolution that appoints, such directors. All directors cease to hold office immediately before the election or appointment of such directors, but are eligible for re-election or re-appointment.
Dividends and Distributions
The Company has not paid any dividends since its incorporation and does not currently have a policy with respect to the payment of dividends. It is anticipated that the Company will not have a fixed dividend policy and will not declare any dividends on the Common Share for the immediate future; rather, all available funds of the Company will be kept as retained earnings to fund operations, used to undertake exploration and development programs on its mineral properties, and for the acquisition of additional mineral properties for the foreseeable future. Any future payment of dividends will depend, among other things, upon the Company’s earnings, capital requirements and operating and financial condition. Generally, dividends can only be paid if a corporation has retained earnings. There can be no assurance that the Company will generate sufficient earnings to allow it to pay dividends.
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The validity of our Common Shares offered by this prospectus will be passed upon for us by Cassels Brock & Blackwell LLP, Toronto, Ontario. Certain legal matters in connection with this offering will be passed upon for us by Vinson & Elkins L.L.P., Houston, Texas.
The financial statements incorporated in this prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2024, have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in audit and accounting.
The estimates of mineral resources and mineral reserves and related information of the Project incorporated by reference herein are based upon analyses contained in the S-K 1300 Technical Report, with an effective date of December 31, 2024, and performed by SGS Canada Inc., Sawtooth Mining LLC, NewFields Mining Design & Technical Services, and EXP U.S. Services Inc. Such estimates and related information have been so incorporated in reliance upon the authority of such firms as experts in such matters.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on Form S-3 (including the exhibits, schedules and amendments thereto) under the Securities Act, with respect to the shares of our securities offered hereby. This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules thereto. For further information with respect to us and the securities offered hereby, we refer you to the registration statement and the exhibits and schedules filed therewith. Statements contained in this prospectus as to the contents of any contract, agreement or any other document are summaries of the material terms of such contract, agreement or other document and are not necessarily complete. With respect to each of these contracts, agreements or other documents filed as an exhibit to the registration statement, reference is made to the exhibits for a more complete description of the matter involved.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. Our registration statement, of which this prospectus constitutes a part, and the exhibits and schedules thereto can be downloaded from the SEC’s website. We file with or furnish to the SEC periodic reports and other information. These reports and other information may be obtained from the SEC’s website as provided above. Our website is located at www.lithiumamericas.com. We make our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports and other information filed with or furnished to the SEC available, free of charge, through our website, as soon as reasonably practicable after those reports and other information are electronically filed with or furnished to the SEC. Information on our website or any other website is not incorporated by reference into this prospectus and does not constitute a part of this prospectus, and investors should not rely on such information in making a decision to purchase our securities.
We furnish or make available to our shareholders annual reports containing our audited financial statements prepared in accordance with U.S. GAAP. We also furnish or make available to our shareholders quarterly reports containing our unaudited interim financial information, including the information required by Form 10-Q, for the first three fiscal quarters of each fiscal year.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
We “incorporate by reference” into this prospectus documents we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus. Some information contained in this prospectus updates the information incorporated by reference, and information that we file subsequently with the SEC will automatically update this prospectus. In other words, in the case of a conflict or inconsistency between information set forth in this prospectus and information that we file later and incorporate by reference into this prospectus, you should rely on the information contained in the document that was filed later.
In particular, we incorporate by reference into this prospectus the documents listed below and any filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the initial filing and prior to effectiveness of the registration statement that contains this prospectus and prior to the time that all the Common Shares offered by this prospectus have been sold by the selling shareholder as described in this prospectus (other than, in each case, documents or information deemed to have been “furnished” and not “filed” in accordance with SEC rules) or such registration statement has been withdrawn:
| • | our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 28, 2025; |
| • | our Quarterly Report on Form 10-Q for the period ended March 31, 2025, filed with the SEC on May 15, 2025; |
| • | our Current Reports on Form 8-K, filed on January 7, 2025, January 7, 2025, March 11, 2025, March 28, 2025, and April 7, 2025 (except that, with respect to each of the foregoing Current Reports, any portion thereof which are furnished and not filed shall not be deemed incorporated by reference into this prospectus); and |
| • | the description of the Common Shares contained in our Registration Statement on Form 20-F, filed with the SEC on August 22, 2023, as amended, and declared effective by the SEC on September 28, 2023, including any amendment or report filed for the purpose of amending such description. |
Any statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus will be deemed to be modified or superseded to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference in this prospectus modifies or supersedes that statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
You may request a copy of the registration statement, the above filings and any future filings that are incorporated by reference into this prospectus, other than an exhibit to a filing unless that exhibit is specifically incorporated by reference into that filing, at no cost, by writing or calling us at the following address:
3260 – 666, Burrard Street
Vancouver, BC V6C 2X8
(778) 656-5820
Attention: Investor Relations
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Lithium Americas Corp.
43,707,080 Common Shares Offered by the Selling Shareholder
PROSPECTUS
, 2025
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The information in this prospectus is not complete and may be changed. These Common Shares may not be sold until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This prospectus is not an offer to sell the Common Shares and is not soliciting an offer to buy the Common Shares in any jurisdiction where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED MAY 15, 2025
PRELIMINARY PROSPECTUS
Lithium Americas Corp.
Up to $100,000,000
Common Shares
We have entered into an equity distribution agreement (the “Sales Agreement”) with TD Securities (USA) LLC (the “U.S. Agent”) and TD Securities Inc. (the “Canadian Agent,” together with the U.S. Agent, “TD” or “Agent,” as applicable) relating to our Common Shares, offered by this prospectus. In accordance with the terms of the Sales Agreement, we may offer and sell our Common Shares having an aggregate sales price of up to $100,000,000 from time to time through TD acting as our sales agent.
Our Common Shares are traded on the NYSE and the TSX under the symbol “LAC.” The last reported sale price of our Common Shares on May 14, 2025, was US$3.08 per share, as reported on the NYSE and C$4.32 per share, as reported on the TSX.
Sales of our Common Shares, if any, under this prospectus will be made in sales deemed to be “at the market” equity offerings as defined in Rule 415 promulgated under the Securities Act, including sales made directly on or through the NYSE, the existing trading market for our Common Shares, sales made to or through a market maker other than on an exchange or otherwise, directly to the sales agent as principal, in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices, and/or in any other method permitted by law. TD is not required to sell any specific amount of securities but will act as our sales agent using commercially reasonable efforts consistent with its normal trading and sales practices on mutually agreed terms between TD and us. There is no arrangement for funds to be received in any escrow, trust or similar arrangement.
The compensation to TD for sales of Common Shares sold pursuant to the Sales Agreement will be at an amount up to 3.0% of the gross proceeds of any Common Shares sold under the Sales Agreement. The net proceeds from any sales under this prospectus will be used as described under “Use of Proceeds” in this prospectus. In connection with the sale of the Common Shares on our behalf, TD will be deemed to be “underwriter” within the meaning of the Securities Act, and the compensation of TD will be deemed to be underwriting commissions or discounts. We have also agreed to provide indemnification and contribution to TD with respect to certain liabilities, including liabilities under the Securities Act or the Exchange Act. See “Plan of Distribution” on page 12 of this prospectus for additional information concerning the compensation to be paid to TD.
Investing in our securities involves risks. See “Risk Factors” beginning on page 9.
Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
TD Securities
The date of this prospectus is , 2025
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We have not authorized anyone to provide any information or to make any representations other than those contained or incorporated by reference in this prospectus, any accompanying prospectus supplement or any free writing prospectus we have prepared. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the securities offered hereby and only under circumstances and in jurisdictions where it is lawful to do so. The information contained or incorporated by reference in this prospectus is current only as of its date.
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This prospectus is part of a registration statement on Form S-3 that we filed with the SEC using a “shelf” registration process. Under this shelf registration process, we may sell any combination of the securities described in this prospectus from time to time and in one or more offerings up to a total dollar amount of $100,000,000. This prospectus generally describes Lithium Americas Corp. and its securities, including its Common Shares. We may use the shelf registration statement to sell the listed securities from time to time through any means described in the section entitled “Plan of Distribution.”
More specific terms of any securities we offer may be provided in a prospectus supplement that describes, among other things, the specific amounts and prices of the securities being offered, any specific allocation of the net proceeds of an offering of securities to a specific purpose and other terms of the offering. The prospectus supplement may also add, update or change information included in this prospectus. You should read both this prospectus and any applicable prospectus supplement, together with additional information described below under the captions “Where You Can Find More Information” and “Incorporation of Certain Information by Reference.”
No offer of the securities will be made in any jurisdiction where the offer is not permitted.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
The information in this prospectus contains or incorporates by reference information that includes or is based upon “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements, other than statements of historical facts, are forward-looking statements and can be identified by the use of statements that include, but are not limited to, words, such as “anticipate,” “plan,” “continue,” “estimate,” “expect,” “may,” “will,” “project,” “predict,” “proposes,” “potential,” “target,” “implement,” “schedule,” “forecast,” “intend,” “would,” “could,” “might,” “should,” “believe” and similar terminology, or statements that certain actions, events or results “may,” “could,” “would,” “might” or “will” be taken, occur or be achieved. Forward-looking statements in this prospectus, including the documents incorporated by reference, includes, but is not limited to:
| • | statements relating to the anticipated sources and uses of funds to complete project financing, statements relating to the JV Transaction with GM, the DOE Loan and the Orion Investment, including statements regarding satisfaction of draw down conditions on the DOE Loan and expected timing for first draw down on the DOE Loan; |
| • | expectations about the extent that the JV Transaction, DOE Loan, the Orion Investment and cash on hand would fund the development and construction of the Project on schedule or at all; |
| • | expectations and timing on the commencement of major construction and first production; |
| • | project de-risking initiatives; |
| • | expectations related to the construction build, job creation and nameplate capacity of the Project as well as other statements with respect to the Company’s future objectives and strategies to achieve these objectives, including the future prospects of the Company; |
| • | the estimated cash flow, capitalization and adequacy thereof for the Company; |
| • | the estimated costs of the development of the Project, including timing, progress, approach, continuity or change in plans, construction, commissioning, milestones, anticipated production and results thereof and expansion plans; |
| • | cost and expected benefits of the transloading terminal; |
| • | cost and expected benefit of the limestone quarry; |
| • | anticipated timing to resolve, and the expected outcome of, any complaints or claims made or that could be made concerning the permitting process in the U.S. for the Project; |
| • | the timely completion of environmental reviews and related consultations, and receipt or issuance of permits and approvals, in the U.S. for the Company’s development and resultant operations; |
| • | capital expenditures and programs; |
| • | estimates, and any change in estimates, of the mineral resources and mineral reserves at the Project; |
| • | development of mineral resources and mineral reserves; |
| • | the realization of mineral resources and mineral reserves estimates, including whether certain mineral resources will ever be developed into mineral reserves, and information and underlying assumptions related thereto; |
| • | government regulation of mining operations and treatment under governmental and taxation regimes; the future price of commodities, including lithium; |
| • | the creation of a battery supply chain in the U.S. to support the electric vehicle market; |
| • | the timing and amount of future production, currency exchange and interest rates; |
| • | the Company’s ability to raise capital; |
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| • | expected expenditures to be made by the Company on the Project; |
| • | statements relating to revised capital cost estimates; |
| • | ability to produce high purity battery-grade lithium products; |
| • | settlement of agreements related to the operation and sale of mineral production as well as contracts in respect of operations and inputs required in the course of production; |
| • | the timing, cost, quantity, capacity and product quality of production at the Project; |
| • | successful development of the Project, including successful results from the Company’s testing facility and third-party tests related thereto; |
| • | statements with respect to the expected economics of the Project, including capital costs, operating costs, sustaining capital requirements, after-tax net present value and internal rate of return, pricing assumptions, payback period, sensitivity analyses, net cash flows and life of mine; |
| • | anticipated job creation and the completion of the workforce hub; |
| • | the expectation that the National Construction Agreement (Project Labor Agreement) with North America’s Building Trades Unions for construction of Phase 1 of the Project will minimize construction risk, ensure availability of skilled labor, address the challenges associated with the Project’s remote location and be effective in prioritizing employment of local and regional skilled craft workers, including members of underrepresented communities; |
| • | the expected workforce development training program being prepared with Great Basin College; |
| • | the Company’s commitment to sustainable development, limiting the environmental impact at the Project and plans for phased reclamation during the life of mine including use benefits of growth media; |
| • | ability to achieve capital cost efficiencies; |
| • | anticipated use of any future proceeds and earnings related to the Project; |
| • | anticipated plans regarding the payment or non-payment of dividends; and |
| • | as well as other statements with respect to management’s beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. |
Forward-looking statements involve known and unknown risks, assumptions and other factors that may cause actual results or performance to differ materially. Forward-looking statements reflect the Company’s current views about future events, and while considered reasonable by the Company as of the date of this prospectus, are inherently subject to significant uncertainties and contingencies. Accordingly, there can be no certainty that they will accurately reflect actual results. Assumptions and other factors upon which such forward-looking statements is based include, without limitation:
| • | expectations regarding Phase 2 of the Project, including financing; |
| • | the ability of LN to draw down on the DOE Loan on the anticipated timeline, or at all, and the absence of material adverse events affecting the Company during the construction of the Project; |
| • | the ability of LN to satisfy all draw down conditions for the DOE Loan in a timely manner; |
| • | the ability of the Company to perform conditions and meet expectations regarding the Company’s financial resources and future prospects; |
| • | the ability to meet future objectives and priorities; |
| • | a cordial business relationship between the Company and third-party strategic and contractual partners; |
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| • | the risk of tax liabilities as a result of the Arrangement and general business and economic uncertainties and adverse market conditions; |
| • | the risk that the Arrangement may not be tax-free for income tax purposes and potential significant tax liabilities that the Company may be exposed to if the tax-deferred spinoff rules are not met; |
| • | the risk of tax indemnity obligations owed by the Company to Lithium Argentina following the Arrangement becoming payable, including as a result of events outside of the Company’s control; |
| • | the availability of equipment and facilities necessary to complete development and construction of the Project; |
| • | unforeseen technological and engineering problems; |
| • | changes in general economic and geopolitical conditions, including as a result of regulatory changes by the current U.S. presidential administration, higher interest rates, the rate of inflation, a potential economic recession and potential changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences on, among other things, the extractive resource industry, the green energy transition and the electric vehicle market; |
| • | uncertainties inherent to feasibility studies and mineral resource and mineral reserve estimates; |
| • | the mine processing facilities, based on the results of the testing facility and third-party tests, performing as expected; |
| • | the ability of the Company to secure sufficient additional financing, advance and develop the Project, and to produce battery-grade lithium; |
| • | the respective benefits and impacts of the Project when production operations commence; |
| • | settlement of agreements related to the operation and sale of mineral production as well as contracts in respect of operations and inputs required in the course of production; |
| • | the Company’s ability to operate in a safe and effective manner, and without material adverse impact from the effects of climate change or severe weather conditions; |
| • | uncertainties relating to receiving and maintaining mining, exploration, environmental and other permits or approvals in Nevada; |
| • | demand for lithium, including that such demand is supported by growth in the electric vehicle market and lithium-ion battery market; |
| • | current technological trends; |
| • | the impact of increasing competition in the lithium business, and the Company’s competitive position in the industry; |
| • | continuing support of local communities and the Fort McDermitt Paiute and the Shoshone Tribe in relation to the Project, and continuing constructive engagement with these and other stakeholders, and any expected benefits of such engagement; |
| • | risks related to cost, funding and regulatory authorizations to develop a workforce housing facility; |
| • | the stable and supportive legislative, regulatory and community environment in the jurisdictions where the Company operates; |
| • | impacts of inflation, deflation, currency exchange rates, interest rates and other general economic and stock market conditions; |
| • | the impact of unknown financial contingencies, including litigation costs, environmental compliance costs and costs associated with the impacts of climate change, on the Company’s operations; |
| • | increased attention to environmental, social, governance and safety and sustainability-related matters; |
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| • | risks related to the Company’s public statements with respect to such matters that may be subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing,” (i.e., misleading information or false claims overstating potential sustainability-related benefits); |
| • | risks that the Company may face regarding potentially conflicting initiatives from certain U.S. state or other governments; |
| • | estimates of, and unpredictable changes to, the market prices for lithium products; |
| • | development and construction costs for the Project, and costs for any additional exploration work at the project; |
| • | estimates of mineral resources and mineral reserves, including whether mineral resources not included in mineral reserves will be further developed into mineral reserves; |
| • | some of the modifying factors used to convert mineral resources to mineral reserves may change materially, and could materially impact the mineral reserve estimate; |
| • | reliability of technical data; |
| • | anticipated timing and results of exploration, development and construction activities, including the impact of ongoing supply chain disruptions and availability of equipment and supplies on such timing; |
| • | timely responses from governmental agencies responsible for reviewing and considering the Company’s permitting activities at the Project; |
| • | availability of technology, including low carbon energy sources and water rights, on acceptable terms to advance the Project; |
| • | government regulation of mining operations and mergers and acquisitions activity, and treatment under governmental, regulatory and taxation regimes; |
| • | ability to realize expected benefits from investments in or partnerships with third parties; accuracy of development budgets and construction estimates; |
| • | that the Company will meet its future objectives and priorities; |
| • | that the Company will have access to adequate capital to fund its future projects and plans; |
| • | that such future projects and plans will proceed as anticipated; |
| • | compliance by the JV Partners with terms of agreements and the ability of the JV Partners to fund their share of funding obligations for the Project; |
| • | the lack of any material disputes or disagreements between the JV Partners; |
| • | the regulation of the mining industry by various governmental agencies; |
| • | as well as assumptions concerning general economic and industry growth rates, commodity prices, resource estimates, currency exchange and interest rates and competitive conditions. |
Although the Company believes that the assumptions and expectations reflected in such forward-looking statements are reasonable, the Company can give no assurance that these assumptions and expectations will prove to be correct.
Readers are cautioned that the foregoing lists of factors are not exhaustive. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. As such, readers are cautioned not to place undue reliance on this information, and that this information may not be appropriate for any other purpose, including investment purposes. The Company’s actual results could differ materially from those anticipated in any forward-looking
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statements as a result of the risk factors set out herein, and in the Company’s other continuous disclosure documents available on EDGAR at www.sec.gov. All forward-looking statements contained in this prospectus is expressly qualified by the risk factors set out in the aforementioned documents. Readers are further cautioned to review the full description of risks, uncertainties and management’s assumptions in the aforementioned documents and other disclosure documents available on EDGAR. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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Overview
We are a Canadian-based resource and materials company focused on developing, building and operating significant lithium deposits and chemical processing facilities. Our flagship asset is Thacker Pass, a sedimentary-based lithium deposit located in the McDermitt Caldera in Humboldt County, in northern Nevada (“Thacker Pass”). Thacker Pass is owned by LN, a wholly owned subsidiary of Lithium Nevada Ventures, the JV between the JV Partners. We own a 62% interest in Thacker Pass and will manage the Project, and GM owns a 38% interest in Thacker Pass.
Thacker Pass “Phase 1” refers to the anticipated initial phase of production, targeting 40,000 t/y of battery-grade Li2CO3, “Phase 2” refers to a possible second phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 3” refers to a possible third phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 4” refers to a possible fourth phase of production at Thacker Pass, targeting an additional 40,000 t/y, “Phase 5” refers to a fifth phase of development that would add an additional beneficiation circuit and sulfuric acid plant, without an additional Li2CO3 processing plant, for total planned production capacity of 160,000 t/y.
We also hold investments in GT1 and Ascend Elements, and exploration properties in the U.S. and Canada.
Our Common Shares are listed on the NYSE and on the TSX under the symbol “LAC.”
Amounts stated in this prospectus are in United States dollars, unless otherwise indicated.
Company Information
Our principal executive offices are located at 3260 – 666 Burrard Street, Vancouver, BC V6C 2X8, and our telephone number is (778) 656-5820. Our website is www.lithiumamericas.com. The information found on our website is not part of this prospectus.
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| Common shares offered by us |
Common Shares having an aggregate sales price of up to $100,000,000. |
| Common shares to be outstanding immediately after this offering |
Up to 251,372,408 shares (as more fully described in the notes following this table), assuming sales of 32,467,532 Common Shares in this offering at an offering price of $3.08 per share, which was the last reported sale price of our Common Shares on NYSE on May 14, 2025. The actual number of shares issued will vary depending on the sales price under this offering. |
| Plan of Distribution |
“At the market offering” that may be made from time to time through or to TD, as sales agent. See “Plan of Distribution” on page 12. |
| Use of Proceeds |
We intend to use the net proceeds from this offering for general corporate purposes, which may include funding of corporate and project overhead expenses, financing of capital expenditures, repayment of indebtedness and additions to working capital. Please read “Use of Proceeds.” |
| Risk Factors |
There are risks associated with an investment in our Common Shares. You should consider carefully the risk factors on page 9 of this prospectus and the other risks identified in the documents incorporated by reference herein before making a decision to purchase our Common Shares in this offering. |
| The NYSE and TSX Symbol |
Our Common Shares are listed on NYSE and TSX under the symbol “LAC.” |
The number of Common Shares shown above is based on 218,904,876 Common Shares outstanding as of May 8, 2025. In addition, the number of Common Shares shown above excludes the following potentially dilutive securities outstanding as of that date:
| • | 43,707,080 Common Shares issuable upon conversion of the Convertible Note. |
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An investment in our securities involves a high degree of risk. You should carefully consider those risk factors described under the heading “Risk Factors” in our most recent Annual Report on Form 10-K and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (other than, in each case, information furnished rather than filed), which are incorporated by reference herein, and those risk factors that may be included in any applicable prospectus supplement, together with all of the other information included in this prospectus, any prospectus supplement and the documents we incorporate by reference, in evaluating an investment in our securities. Our business, prospects, financial condition or operating results could be harmed by any of these risks, as well as other risks not currently known to us or that we currently consider immaterial. The trading price of our Common Shares could decline due to any of these risks, and, as a result, you may lose all or part of your investment. Before deciding whether to invest in our securities, you should also refer to the other information contained in or incorporated by reference into this prospectus, including the section entitled “Cautionary Note Regarding Forward-Looking Statements.”
Risks Related to the Offering
Future sales of our Common Shares, or the perception that such sales may occur, may depress our stock price.
We or our shareholders may sell Common Shares in the future. A substantial number of our Common Shares are reserved for issuance upon conversion of notes evidencing our current indebtedness and upon vesting of restricted share units. If we or our shareholders sell substantial amounts of our Common Shares (including shares issued upon the conversion of notes or vesting of restricted share units) in the public market, or if the market perceives that such sales may occur, the market price of our Common Shares could fall and it may become more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem appropriate. For example, pursuant to the obligations set forth in the Registration Rights Agreement, the Company has registered for resale by Orion up to 43,707,080 Common Shares. Sales of these Common Shares or of other Common Shares held by existing shareholders could cause the market price of our Common Shares to decline. We cannot predict the size of future issuances or sales of our Common Shares or the effect, if any, that future issuances and sales of our Common Shares will have on the market price of our Common Shares.
The Common Shares offered under this prospectus may be sold in “at-the-market” offerings, and investors who buy shares at different times will likely pay different prices.
Investors who purchase shares under this prospectus at different times will likely pay different prices, and so may experience different outcomes in their investment results. We will have discretion, subject to market demand, to vary the timing, prices, and numbers of shares sold, and there is no minimum or maximum sales price. Investors may experience declines in the value of their shares as a result of share sales made at prices lower than the prices they paid.
There is no certainty regarding the net proceeds to the Company.
There is no certainty that US$100,000,000 will be raised under the offering. The Agents have agreed to use their commercially reasonable efforts to sell, on the Company’s behalf, the Offered Shares designated by the Company, but the Company is not required to request the sale of the maximum amount offered or any amount and, if the Company requests a sale, the Agents are not obligated to purchase any Offered Shares that are not sold. As a result of the Offering being made on a commercially reasonable efforts basis with no minimum, and only as requested by the Company, the Company may raise substantially less than the maximum total offering amount or nothing at all.
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Our management will have broad discretion as to the use of proceeds from this offering and we may not use the proceeds effectively.
Our management will have broad discretion in the application of the net proceeds from this offering, if any, and could spend the proceeds in ways that do not improve our results of operations or enhance the value of our Common Shares. You will be relying on the judgment of our management concerning these uses and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. The failure of our management to apply these funds effectively could result in unfavorable returns and uncertainty about our prospects, each of which could cause the price of our Common Shares to decline.
The actual number of shares we will issue under the Sales Agreement, at any one time or in total, is uncertain.
Subject to certain limitations in the Sales Agreement and compliance with applicable law, we have the discretion to deliver a sales notice to the sales agent at any time throughout the term of the Sales Agreement. The number of shares that are sold by TD after the delivery of a sales notice will fluctuate based on the market price of the Common Shares during the sales period and limits we set with TD. Because the price per share of each share sold will fluctuate based on the market price of our Common Shares during the sales period, it is not possible at this stage to predict the number of shares that will ultimately be issued.
If you purchase our Common Shares in this offering, you may incur immediate and substantial dilution or you may experience future dilution as a result of future equity offerings.
The price per Common Share being offered may be higher than the net tangible book value per share of our outstanding Common Shares at the time you are purchasing Common Shares in this offering. Also, in order to raise additional capital, we may in the future offer additional Common Shares or other securities convertible into or exchangeable for Common Shares at prices that may not be the same as the price per share in this offering. We may sell shares or other securities in any other offering at a price per share that is less than the price per share paid by any investors in this offering, and investors purchasing shares or other securities in the future could have rights superior to existing shareholders. The price per share at which we sell additional Common Shares, or securities convertible or exchangeable into Common Shares, in future transactions may be higher or lower than the price per share paid by any investors in this offering.
We do not currently intend to pay dividends on our Common Shares, and any return to investors is expected to come, if at all, only from potential increases in the price of our Common Shares.
We have never declared or paid cash dividends on our capital stock, and you should not rely on an investment in our Common Shares to provide dividend income. We anticipate that we will retain all of our future earnings, if any, to finance the growth and development of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. In addition, the Company’s ability to pay dividends is, and may be in the future, limited by covenants contained in the DOE Loan, the JV Transaction documents, and the Orion Investment documents, as well as the terms of any future debt agreements which may preclude us from paying dividends. As a result, capital appreciation, if any, of our Common Shares will be your sole source of gain for the foreseeable future.
An investment in the Common Shares is speculative and may result in the loss of an investor’s entire investment.
An investment in the Common Shares is speculative and may result in the loss of an investor’s entire investment. Only potential investors who are experienced in high-risk investments and who can afford to lose their entire investment should consider an investment in the Company. Investors should consult with their professional advisors to assess any investment in the Company.
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We may issue and sell our Common Shares having an aggregate gross sale proceeds of up to $100,000,000 from time to time. We are not guaranteed to receive any particular amount of proceeds from this offering, or fully utilize, the Sales Agreement. The amount of proceeds we receive from this offering will depend upon the number of Common Shares sold and the market price at which they are sold. Sales pursuant to the Sales Agreement may be made through an affiliate of TD.
We intend to use the net proceeds from this offering for general corporate purposes, which may include funding of corporate and project overhead expenses, financing of capital expenditures, repayment of indebtedness and additions to working capital.
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We have entered into a Sales Agreement with TD, under which we may offer and sell up to $100,000,000 of our Common Shares from time to time through TD acting as agent. Sales of our Common Shares, if any, under this prospectus and the accompanying prospectus will be made by any method that is deemed to be an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act, including sales made directly on or through the NYSE, sales made to or through a market maker other than on an exchange or otherwise, directly to the sales agent as principal, in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices, and/or in any other method permitted by law.
Each time we wish to issue and sell Common Shares under the Sales Agreement, we will notify TD of the number of shares to be issued, the dates on which such sales are anticipated to be made, any limitation on the number of shares to be sold in any one day and any minimum price below which sales may not be made. Once we have so instructed TD, unless TD declines to accept the terms of such notice, TD has agreed to use its commercially reasonable efforts consistent with its normal trading and sales practices to sell such shares up to the amount specified on such terms. The obligations of TD under the Sales Agreement to sell our Common Shares are subject to a number of conditions that we must meet. TD is not required to sell any specific amount of securities. We may instruct the sales agents not to sell our Common Shares if the sales cannot be effected at or above the price designated by us in any such instruction. We and TD may suspend the offering of Common Shares upon proper notice to the other party and subject to other conditions. We, the U.S. Agent and the Canadian Agent, with respect to itself but not with respect to the other Agent, each have the right, by giving written notice as specified in the Sales Agreement, to terminate the Sales Agreement in each party’s sole discretion at any time upon ten days’ written notice.
The settlement of sales of shares between TD and us is generally anticipated to occur on the first trading day following the date on which the sale was made. Sales of our Common Shares as contemplated in this prospectus will be settled through the facilities of The Depository Trust Company or by such other means as we and TD may agree upon. There is no arrangement for funds to be received in an escrow, trust or similar arrangement.
We will pay TD a commission of an amount up to 3.0% of the aggregate gross proceeds we receive from each sale of our Common Shares. Because there is no minimum offering amount required as a condition to close this offering, the actual total public offering amount, commissions and proceeds to us, if any, are not determinable at this time. In addition, we have agreed to reimburse TD for the fees and disbursements of its counsel, payable upon execution of the Sales Agreement, in an amount not to exceed $75,000, in addition to certain ongoing disbursements of its legal counsel, unless we and TD otherwise agree. We estimate that the total expenses for the offering, excluding any commissions or expense reimbursement payable to TD under the terms of the Sales Agreement, will be approximately $1,050,000. The remaining sale proceeds, after deducting any other transaction fees, will equal our net proceeds from the sale of such shares.
TD will provide written confirmation to us before the open on NYSE on the day following each day on which Common Shares are sold under the Sales Agreement. Each confirmation will include the number of shares sold on that day, the aggregate gross proceeds of such sales and the proceeds to us.
In connection with the sale of the Common Shares on our behalf, TD will be deemed to be an “underwriter” within the meaning of the Securities Act, and the compensation of TD will be deemed to be underwriting commissions or discounts. We have agreed to indemnify TD against certain civil liabilities, including liabilities under the Securities Act. We have also agreed to contribute to payments TD may be required to make in respect of such liabilities.
The offering of our Common Shares pursuant to the Sales Agreement will terminate upon the earlier of (i) the sale of all Common Shares subject to the Sales Agreement and (ii) the termination of the Sales Agreement as permitted therein.
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The U.S. Agent will only sell Common Shares on marketplaces in the United States. If applicable, the Canadian Agent will only sell Common Shares on marketplaces in Canada.
This summary of the material provisions of the Sales Agreement does not purport to be a complete statement of its terms and conditions. A copy of the Sales Agreement is filed as Exhibit 1.2 to the registration statement of which this prospectus forms a part. See “Where You Can Find More Information.”
TD and its affiliates may in the future provide various investment banking, commercial banking, financial advisory and other financial services for us and our affiliates, for which services they may in the future receive customary fees. In the course of its business, TD may actively trade our securities for its own account or for the accounts of customers, and, accordingly, TD may at any time hold long or short positions in such securities.
A prospectus in electronic format may be made available on a website maintained by TD, and TD may distribute the prospectus electronically.
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The following summary of certain material provisions of our capital stock does not purport to be complete and is subject to and qualified by reference to our Articles.
Common Shares
The Company is authorized to issue an unlimited number of Common Shares without par value of which, as at May 8, 2025, a total of 218,904,876 Common Shares are issued and outstanding. Holders of Common Shares are entitled to receive notice of and to attend all meetings of shareholders and to one vote in respect of each Common Share held at all such meetings. Subject to the rights of holders of any other class of shares of the Company entitled to receive dividends in priority, shareholders will be entitled to receive dividends if, as and when declared by the Board of Directors out of the assets of the Company properly applicable to the payment of dividends. In the event of the liquidation, dissolution or winding up of the Company or other distribution of assets of the Company among its shareholders for the purpose of winding up its affairs, shareholders will be entitled to all remaining property and assets of the Company on a share for share basis.
Other than the participation right held by GM and discussed in more detail below, the Common Shares are not subject to pre-emptive, redemption, purchase or conversion rights. There are no sinking fund provisions in relation to the Common Shares and they are not liable to further calls or assessment by the Company. The BCBCA and our Articles provide that the rights and restrictions attached to any class of shares may not be modified, amended or varied unless consented to by special resolution passed by not less than two-thirds of the votes cast in person or by proxy by holders of shares of that class.
GM Investor Rights Agreement
GM has certain board nomination rights, oversight and demand registration and piggy-back registration rights and securities offering participation rights, and is also subject to certain standstill limitations pertaining to take-over bids (and similar transactions) until a period that ends on the earlier of (i) five years from the date of the Separation, and (ii) one year following the date of the commencement of commercial production for Phase 1 as outlined in the Offtake Agreement.
Election of Directors
Directors are elected annually for a term of one year, as approved by the vote of shareholders entitled to vote at the annual general meeting for the election of directors, or in the unanimous resolution that appoints, such directors. All directors cease to hold office immediately before the election or appointment of such directors, but are eligible for re-election or re-appointment.
Dividends and Distributions
The Company has not paid any dividends since its incorporation and does not currently have a policy with respect to the payment of dividends. It is anticipated that the Company will not have a fixed dividend policy and will not declare any dividends on the Common Share for the immediate future; rather, all available funds of the Company will be kept as retained earnings to fund operations, used to undertake exploration and development programs on its mineral properties, and for the acquisition of additional mineral properties for the foreseeable future. Any future payment of dividends will depend, among other things, upon the Company’s earnings, capital requirements and operating and financial condition. Generally, dividends can only be paid if a corporation has retained earnings. There can be no assurance that the Company will generate sufficient earnings to allow it to pay dividends.
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CERTAIN CANADIAN INCOME TAX CONSIDERATIONS
The following is a general summary of the principal Canadian federal income tax considerations as of the date of this prospectus that generally apply to a person who acquires Common Shares pursuant to this offering as beneficial owner and who, at all relevant times for purposes of the Income Tax Act (Canada) and the regulations thereunder (collectively, the “Canadian Tax Act”), acquires and holds their Common Shares as capital property, deals at arm’s length with the Company and TD and is not affiliated with the Company or TD (a “Holder”).
Common Shares will generally be considered to be capital property to a Holder unless the Holder holds or uses the Common Shares or is deemed to hold or use the Common Shares in the course of carrying on a business of trading or dealing in securities or has acquired them or is deemed to have acquired them in a transaction or transactions considered to be an adventure or concern in the nature of trade.
This summary is generally applicable to a Holder who, at all relevant times, for purposes of the Canadian Tax Act and the Convention Between Canada and the United States of America With Respect to Taxes on Income and on Capital (1980), as amended (the “Convention”): (i) not, and is not deemed to be, resident in Canada; (ii) is resident solely in the United States and is entitled to benefits of the Convention; (iii) does not use or hold, and is not and will not be deemed to use or hold, the Common Shares in connection with carrying on a business in Canada (each such holder, a “U.S. Resident Holder”).
This summary is not applicable to a U.S. Resident Holder (i) that is a “financial institution” within the meaning of section 142.2 of the Canadian Tax Act; (ii) that is a “specified financial institution” as defined in the Canadian Tax Act; (iii) an interest in which is a “tax shelter investment” for the purposes of the Canadian Tax Act; (iv) that has entered into or will enter into a “derivative forward agreement,” “synthetic equity arrangement” or “synthetic disposition arrangement,” each as defined in the Canadian Tax Act, in respect of the Common Shares; (v) that receives dividends on the Common Shares under or as part of a “dividend rental arrangement” as defined in the Canadian Tax Act; or (vi) is an “authorized foreign bank” (as defined in the Canadian Tax Act) or an insurer that carries on business in Canada and elsewhere.
This summary is based upon: (i) the current provisions of the Canadian Tax Act and the Convention in force as of the date prior to the date hereof; (ii) all specific proposals (“Proposed Amendments”) to amend the Canadian Tax Act that have been publicly announced by, or on behalf of, the Minister of Finance (Canada) prior to the date hereof; and (iii) counsel’s understanding of the current administrative policies and assessing practices of the Canada Revenue Agency (“CRA”) published in writing by the CRA prior to the date hereof. This summary assumes that the Proposed Amendments will be enacted in the form proposed, although no assurance can be given that the Proposed Amendments will be enacted or otherwise implemented in their current form, if at all. If the Proposed Amendments are not enacted or otherwise implemented as presently proposed, the tax consequences may not be as described below in all cases. Other than the Proposed Amendments, this summary does not take into account or anticipate any changes in law or in the CRA’s administrative policies or assessing practices, whether by legislative, regulatory, administrative, governmental or judicial decision or action, nor does it take into account any provincial, territorial or foreign income tax legislation or considerations, which considerations may differ significantly from the Canadian federal income tax considerations discussed in this summary.
This summary is of a general nature only, is not exhaustive of all possible Canadian federal income tax considerations and is not, and is not intended to be, and should not be construed to be, legal or tax advice to any particular U.S. Resident Holder, and no representations concerning the tax consequences to any particular U.S. Resident Holder are made. The tax consequences of acquiring, holding and disposing of Common Shares will vary according to the U.S. Resident Holder’s particular circumstances. U.S. Resident Holders should consult their own tax advisors regarding the tax considerations applicable to them having regard to their particular circumstances.
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Currency: All amounts relevant in computing a U.S. Resident Holder’s liability under the Canadian Tax Act are to be computed in Canadian dollars.
Taxation of Dividends: Under the Canadian Tax Act, dividends paid or credited, or deemed to be paid or credited, to a U.S. Resident Holder on the Common Shares will generally be subject to Canadian withholding tax at a rate of 25% of the gross amount of such dividends unless the rate is reduced under the Convention. Under the Convention, the rate of withholding tax on dividends applicable to U.S. Resident Holders who beneficially own the dividends is generally reduced to 15% (or to 5% if the beneficial owner of such dividend is a U.S. Resident Holder that is a company that beneficially owns, or is deemed to beneficially own, at least 10% of the voting shares of the Company) of the gross amount of such dividends.
Disposition of Common Shares: Generally, a U.S. Resident Holder will not be subject to tax under the Canadian Tax Act in respect of any capital gain realized by such U.S. Resident Holder on a disposition or deemed disposition of the Common Shares unless the Common Shares are or are deemed to be “taxable Canadian property” of the U.S. Resident Holder at the time of disposition (as defined in the Canadian Tax Act) and the U.S. Resident Holder is not entitled to relief under the Convention.
Provided that the Common Shares are listed on a “designated stock exchange” for the purposes of the Canadian Tax Act (which currently includes the TSX and NYSE), at the time of disposition, the Common Shares generally will not constitute taxable Canadian property of a U.S. Resident Holder at that time, unless at any time during the 60-month period immediately preceding the disposition the following two conditions are met concurrently, (i) 25% or more of the issued shares of any class or series of the capital stock of the Company were owned by, or belonged to, one or any combination of (a) the U.S. Resident Holder, (b) persons with whom the U.S. Resident Holder did not deal at arm’s length, and (c) partnerships in which the U.S. Resident Holder or a person described in (b) holds a membership interest directly or indirectly through one or more partnerships; and (ii) more than 50% of the fair market value of such shares was derived, directly or indirectly, from one or any combination of real or immovable property situated in Canada, “Canadian resource property” (as defined in the Canadian Tax Act), “timber resource property” (as defined in the Canadian Tax Act), or options in respect of, interests in, or, for civil law, rights in, any of the foregoing properties, whether or not such property exists. Notwithstanding the foregoing, a Common Share may also be deemed to be taxable Canadian property to a U.S. Resident Holder for purposes of the Canadian Tax Act in certain other circumstances. U.S. Resident Holders should consult their own tax advisors as to whether their Common Shares constitute “taxable Canadian property” in their own particular circumstances.
Even if the Common Shares are taxable Canadian property to a U.S. Resident Holder, a U.S. Resident Holder may be subject to relief from taxation in Canada pursuant to the terms of the Convention. U.S. Resident Holders for whom the Offered Shares will or may be taxable Canadian property should consult their own tax advisors regarding the tax and compliance considerations that may be relevant to them.
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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following is a general summary of the material U.S. federal income tax considerations applicable to a U.S. Holder (as defined below) as a result of the acquisition, ownership and disposition of Common Shares acquired pursuant to this offering.
This summary is for general information purposes only and does not purport to be a complete analysis or listing of all potential U.S. federal income tax considerations that may apply to a U.S. Holder as a result of the acquisition, ownership and disposition of Common Shares acquired pursuant to this offering. In addition, this summary does not take into account the individual facts and circumstances of any particular U.S. Holder that may affect the U.S. federal income tax consequences to such U.S. Holder, including specific tax consequences to a U.S. Holder under an applicable tax treaty (other than the Convention). Accordingly, this summary is not intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to any particular U.S. Holder. This summary does not address the U.S. federal 3.8% Medicare tax on certain net investment income, U.S. federal alternative minimum tax, U.S. federal estate and gift tax, U.S. state and local tax, and non-U.S. tax consequences to U.S. Holders of the acquisition, ownership, and disposition of Common Shares. In addition, except as specifically set forth below, this summary does not discuss applicable tax reporting requirements. Each U.S. Holder should consult its own tax advisor regarding the U.S. federal, 3.8% Medicare tax on certain net investment income, U.S. federal alternative minimum tax, U.S. federal estate and gift tax, U.S. state and local tax, and non-U.S. tax consequences relating to the acquisition, ownership and disposition of Common Shares.
No ruling from the Internal Revenue Service (the “IRS”) has been requested, or will be obtained, regarding the U.S. federal income tax considerations applicable to U.S. Holders as discussed in this summary. This summary is not binding on the IRS, and the IRS is not precluded from taking a position that is different from, and contrary to, the positions taken in this summary. In addition, because the authorities on which this summary is based are subject to various interpretations, the IRS and the U.S. courts could disagree with one or more of the positions taken in this summary.
Scope of this Summary
Authorities
This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), U.S. Treasury Regulations (whether final, temporary, or proposed) promulgated under the Code, published rulings of the IRS, published administrative positions of the IRS, the Convention, and U.S. court decisions, that are in effect and available, as of the date of this document. Any of the authorities on which this summary is based could be changed in a material and adverse manner at any time, and any such change could be applied retroactively. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied on a retroactive or prospective basis.
U.S. Holders
For purposes of this summary, the term “U.S. Holder” means a beneficial owner of Common Shares acquired pursuant to this offering that is for U.S. federal income tax purposes:
| • | an individual who is a citizen or resident of the United States; |
| • | a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia; |
| • | an estate whose income is subject to U.S. federal income taxation regardless of its source; or |
| • | a trust that (1) is subject to the primary supervision of a court within the United States and the control of one or more United States persons (within the meaning of Section 7701(a)(30) of the Code) for all |
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| substantial decisions or (2) has a valid election in effect under applicable U.S. Treasury Regulations to be treated as a United States person. |
U.S. Holders Subject to Special U.S. Federal Income Tax Rules Not Addressed
This summary does not address the U.S. federal income tax considerations applicable to U.S. Holders that are subject to special provisions under the Code, including U.S. Holders that: (a) are tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred accounts; (b) are financial institutions, underwriters, insurance companies, real estate investment trusts, or regulated investment companies; (c) are brokers or dealers in securities or currencies or are traders in securities that elect to apply a mark-to-market accounting method; (d) have a “functional currency” other than the U.S. dollar; (e) own Common Shares as part of a straddle, hedging transaction, conversion transaction, constructive sale, or other integrated transaction; (f) acquired Common Shares in connection with the exercise of employee stock options or otherwise as compensation for services; (g) hold Common Shares other than as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment purposes); (h) are partnerships and other pass-through entities (and investors in such partnerships and entities); (i) are S corporations (and shareholders therein); (j) are subject to special tax accounting rules; (k) own, have owned or will own (directly, indirectly, or by attribution) 10% or more of the total combined voting power or value of our outstanding shares; (l) are U.S. expatriates or former long-term residents of the United States; or (m) hold Common Shares in connection with a trade or business, permanent establishment, or fixed base outside the United States. U.S. Holders that are subject to special provisions under the Code, including U.S. Holders described immediately above, should consult their own tax advisors regarding the consequences relating to the acquisition, ownership and disposition of Common Shares.
If an entity or arrangement that is classified as a partnership (or other pass-through entity) for U.S. federal income tax purposes holds Common Shares, the U.S. federal income tax consequences to such entity or arrangement and the owners of such entity or arrangement generally will depend on the activities of such entity or arrangement and the status of such partners (or other owners). This summary does not address the tax consequences to any such entity or arrangement or partner (or other owner). Such entities or arrangements and partners (or other owners) therein should consult their own tax advisor regarding the U.S. federal income tax consequences relating to the acquisition, ownership, and disposition of Common Shares.
Passive Foreign Investment Company Rules
If we are considered a “passive foreign investment company” (“PFIC”) within the meaning of Section 1297 of the Code at any time during a U.S. Holder’s holding period, the following sections will generally describe the potentially adverse U.S. federal income tax consequences to U.S. Holders of the acquisition, ownership, and disposition of Common Shares.
We have not determined whether we were a PFIC for our most recently completed tax year and whether we may be a PFIC for our current tax year or any future tax year. In addition, no opinion of legal counsel or ruling from the IRS concerning our status as a PFIC has been obtained or is currently planned to be requested. The determination of whether any corporation was, or will be, a PFIC for a tax year depends, in part, on the application of complex U.S. federal income tax rules, which are subject to differing interpretations. In addition, whether any corporation will be a PFIC for any tax year depends on the composition of the assets, income and operations of such corporation and the fair market value of such corporation’s assets over the course of each such tax year. We are not certain whether the composition of our assets and income, including the amount of non-passive income we generate from our operations, will be such that we meet the PFIC asset test or PFIC income test (each discussed below) for the current year or any future years. As a result, our PFIC status for the current year and future years cannot be predicted with certainty as of the date of this document. Accordingly, there can be no assurance that the IRS will not challenge any PFIC determination made by us. Each U.S. Holder should consult its own tax advisor regarding our status as a PFIC and the PFIC status of each of our non-U.S. subsidiaries.
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In any year in which we are classified as a PFIC, a U.S. Holder will be required to file an annual report with the IRS containing such information as Treasury Regulations and/or other IRS guidance may require. In addition to penalties, a failure to satisfy such reporting requirements may result in an extension of the time period during which the IRS can assess a tax. U.S. Holders should consult their own tax advisors regarding the requirements of filing such information returns under these rules, including the requirement to file IRS Form 8621 annually.
We generally will be a PFIC for any tax year in which (a) 75% or more of our gross income for such tax year is passive income (the “PFIC income test”) or (b) 50% or more of the value of our assets either produce passive income or are held for the production of passive income, based on the quarterly average of the fair market value of such assets (the “PFIC asset test”). “Gross income” generally includes sales revenues less the cost of goods sold, plus income from investments and from incidental or outside operations or sources, and “passive income” generally includes, for example, dividends, interest, certain rents and royalties, certain gains from the sale of stock and securities, and certain gains from commodities transactions.
For purposes of the PFIC income test and PFIC asset test described above, if we own, directly or indirectly, 25% or more of the total value of the outstanding shares of another corporation, we will be treated as if we (a) held a proportionate share of the assets of such other corporation and (b) received directly a proportionate share of the income of such other corporation. In addition, for purposes of the PFIC income test and PFIC asset test described above, “passive income” does not include any interest, dividends, rents, or royalties that are received or accrued by us from a “related person” (as defined in Section 954(d)(3) of the Code), to the extent such items are properly allocable to the income of such related person that is not passive income.
Under certain attribution rules, if we are a PFIC, U.S. Holders will be deemed to own their proportionate share of any of our subsidiaries which are also PFICs (each, a “Subsidiary PFIC”), and will generally be subject to U.S. federal income tax as discussed below, under the heading “Default PFIC Rules Under Section 1291 of the Code”, on their proportionate share of any (i) distribution on the shares of a Subsidiary PFIC and (ii) disposition or deemed disposition of shares of a Subsidiary PFIC, both as if such U.S. Holders directly held the shares of such Subsidiary PFIC. Accordingly, U.S. Holders should be aware that they could be subject to tax under the PFIC rules even if no distributions are received and no redemptions or other dispositions of Common Shares are made. In addition, U.S. Holders may be subject to U.S. federal income tax on any indirect gain realized on the stock of a Subsidiary PFIC on the sale or disposition of Common Shares.
Default PFIC Rules Under Section 1291 of the Code
If we are a PFIC, the U.S. federal income tax consequences to a U.S. Holder of the purchase of Common Shares and the acquisition, ownership, and disposition of Common Shares will depend on whether such U.S. Holder makes a “qualified electing fund” or “QEF” election under Section 1295 of the Code (a “QEF Election”) or makes a mark-to-market election under Section 1296 of the Code (a “Mark-to-Market Election”) with respect to the Common Shares. A U.S. Holder that does not make either a QEF Election or a Mark-to-Market Election (a “Non-Electing U.S. Holder”) will be subject to tax as described below.
A Non-Electing U.S. Holder will be subject to the rules of Section 1291 of the Code with respect to (a) any gain recognized on the sale, exchange or other taxable disposition of Common Shares and (b) any excess distribution received on the Common Shares. A distribution generally will be an “excess distribution” to the extent that such distribution (together with all other distributions received in the current tax year) exceeds 125% of the average annual distributions received during the three preceding tax years (or during a U.S. Holder’s holding period for the Common Shares, if shorter).
Under Section 1291 of the Code, any gain recognized on the sale, exchange or other taxable disposition of Common Shares of a PFIC (including an indirect disposition of shares of a Subsidiary PFIC), and any excess distribution received on such Common Shares (or a distribution by a Subsidiary PFIC to its shareholder that is deemed to be received by a U.S. Holder) must be ratably allocated to each day in a Non-Electing U.S. Holder’s
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holding period for the Common Shares. The amount of any such gain or excess distribution allocated to the tax year of disposition or distribution of the excess distribution and to years before the entity became a PFIC, if any, would be taxed as ordinary income (and not eligible for certain preferential tax rates, as discussed below). The amounts allocated to any other tax year would be subject to U.S. federal income tax at the highest tax rate applicable to ordinary income in each such year, and an interest charge would be imposed on the tax liability for each such year, calculated as if such tax liability had been due in each such year. A Non-Electing U.S. Holder that is not a corporation must treat any such interest paid as “personal interest,” which is not deductible.
If we are a PFIC for any tax year during which a Non-Electing U.S. Holder holds Common Shares, we will continue to be treated as a PFIC with respect to such Non-Electing U.S. Holder, regardless of whether we cease to be a PFIC in one or more subsequent tax years. If we are a PFIC in the prior tax year, current tax year or any future tax year but cease to be a PFIC in a subsequent tax year, a Non-Electing U.S. Holder may terminate this deemed PFIC status with respect to Common Shares by electing to recognize gain (which will be taxed under the rules of Section 1291 of the Code as discussed above) as if such Common Shares were sold on the last day of the last tax year for which we were a PFIC.
QEF Election
A U.S. Holder that makes a QEF Election for the first tax year in which the holding period of its Common Shares begins generally will not be subject to the rules of Section 1291 of the Code discussed above with respect to its Common Shares. However, a U.S. Holder that makes a QEF Election will be subject to U.S. federal income tax on such U.S. Holder’s pro rata share of (a) our net capital gain, which will be taxed as long-term capital gain to such U.S. Holder, and (b) our ordinary earnings, which will be taxed as ordinary income to such U.S. Holder. Generally, “net capital gain” is the excess of (a) net long-term capital gain over (b) net short-term capital loss, and “ordinary earnings” are the excess of (a) “earnings and profits” over (b) net capital gain. A U.S. Holder that makes a QEF Election will be subject to U.S. federal income tax on such amounts for each tax year in which we are a PFIC, regardless of whether such amounts are actually distributed to such U.S. Holder by us. However, for any tax year in which we are a PFIC and have no net income or gain, U.S. Holders that have made a QEF Election would not have any income inclusions as a result of the QEF Election. If a U.S. Holder that made a QEF Election has an income inclusion, such a U.S. Holder may, subject to certain limitations, elect to defer payment of current U.S. federal income tax on such amounts, subject to an interest charge. If such U.S. Holder is not a corporation, any such interest paid will be treated as “personal interest,” which is not deductible.
A U.S. Holder that makes a timely and effective QEF Election generally (a) may receive a tax-free distribution from us to the extent that such distribution represents “earnings and profits” that were previously included in income by the U.S. Holder because of such QEF Election and (b) will adjust such U.S. Holder’s tax basis in the Common Shares to reflect the amount included in income or allowed as a tax-free distribution because of such QEF Election. In addition, a U.S. Holder that makes a QEF Election generally will recognize capital gain or loss on the sale, exchange or other taxable disposition of Common Shares.
The procedure for making a QEF Election, and the U.S. federal income tax consequences of making a QEF Election, will depend on whether such QEF Election is timely. A QEF Election will be treated as “timely” for purposes of avoiding the default PFIC rules discussed above if such QEF Election is made for the first year in the U.S. Holder’s holding period for the Common Shares in which we were a PFIC. A U.S. Holder may make a timely QEF Election by filing the appropriate QEF Election documents at the time such U.S. Holder files a U.S. federal income tax return for such year. If a U.S. Holder owns PFIC stock indirectly through another PFIC, separate QEF Elections must be made for the PFIC in which the U.S. Holder is a direct shareholder and the Subsidiary PFIC for the QEF rules to apply to both PFICs.
A QEF Election will apply to the tax year for which such QEF Election is made and to all subsequent tax years, unless such QEF Election is invalidated or terminated or the IRS consents to revocation of such QEF Election. If a U.S. Holder makes a QEF Election and, in a subsequent tax year, we cease to be a PFIC, the QEF
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Election will remain in effect (although it will not be applicable) during those tax years in which we were not a PFIC. Accordingly, if we become a PFIC in another subsequent tax year, the QEF Election will be effective and the U.S. Holder will be subject to the QEF rules described above during any subsequent tax year in which we qualify as a PFIC.
For each tax year that we qualify as a PFIC, as determined by us, we: (a) intend to make publicly available to U.S. Holders, upon their written request, a “PFIC Annual Information Statement” for us as described in Treasury Regulation Section 1.1295-1(g) (or any successor Treasury Regulation), and (b) upon written request, intend to use commercially reasonable efforts to provide such additional information that such U.S. Holder is reasonably required to obtain in connection with maintaining such QEF Election with regard to us. We may elect to provide such information on our website. However, U.S. Holders should be aware that we can provide no assurances that we will provide any such information relating to any Subsidiary PFIC and as a result, a QEF Election may not be available with respect to any Subsidiary PFIC. Because we may own shares in one or more Subsidiary PFICs at any time, U.S. Holders will continue to be subject to the rules discussed above with respect to the taxation of gains and excess distributions with respect to any Subsidiary PFIC for which the U.S. Holders do not obtain such required information. Each U.S. Holder should consult its own tax advisor regarding the availability of, and procedure for making, a QEF Election with respect to us and any Subsidiary PFIC.
A U.S. Holder makes a QEF Election by attaching a completed IRS Form 8621, including a PFIC Annual Information Statement, to a timely filed U.S. federal income tax return. However, if we do not provide the required information with regard to us or any Subsidiary PFICs, U.S. Holders will not be able to make a QEF Election for such entity and will continue to be subject to the rules of Section 1291 of the Code discussed above that apply to Non-Electing U.S. Holders with respect to the taxation of gains and excess distributions.
Mark-to-Market Election
A U.S. Holder may make a Mark-to-Market Election, instead of a QEF Election, with respect to Common Shares only if the Common Shares are marketable stock. The Common Shares generally will be “marketable stock” if the Common Shares are regularly traded on (a) a national securities exchange that is registered with the SEC, (b) the national market system established pursuant to Section 11A of the Exchange Act or (c) a foreign securities exchange that is regulated or supervised by a governmental authority of the country in which the market is located, provided that (i) such foreign exchange has trading volume, listing, financial disclosure, surveillance and other requirements and the laws of the country in which such foreign exchange is located, together with the rules of such foreign exchange, ensure that such requirements are actually enforced and (ii) the rules of such foreign exchange ensure active trading of listed stocks. If such stock is traded on such a qualified exchange or other market, such stock generally will be considered “regularly traded” for any calendar year during which such stock is traded, other than in de minimis quantities, on at least 15 days during each calendar quarter. U.S. Holders should consult their own tax advisors regarding the marketable stock rules.
A U.S. Holder that makes a Mark-to-Market Election with respect to its Common Shares generally will not be subject to the rules of Section 1291 of the Code discussed above with respect to such Common Shares. However, if a U.S. Holder does not make a Mark-to-Market Election beginning in the first tax year of such U.S. Holder’s holding period for the Common Shares and such U.S. Holder has not made a timely QEF Election, the rules of Section 1291 of the Code discussed above will apply to certain dispositions of, and distributions on, the Common Shares.
A U.S. Holder that makes a timely and effective Mark-to-Market Election will include in ordinary income, for each tax year in which we are a PFIC, an amount equal to the excess, if any, of (a) the fair market value of the Common Shares, as of the close of such tax year over (b) such U.S. Holder’s tax basis in the Common Shares. A U.S. Holder that makes a Mark-to-Market Election will be allowed a deduction in an amount equal to the excess, if any, of (i) such U.S. Holder’s adjusted tax basis in the Common Shares, over (ii) the fair market value of such Common Shares (but only to the extent of the net amount of previously included income as a result of the Mark-to-Market Election for prior tax years).
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A U.S. Holder that makes a timely and effective Mark-to-Market Election generally also will adjust such U.S. Holder’s tax basis in the Common Shares to reflect the amount included in gross income or allowed as a deduction because of such Mark-to-Market Election. In addition, upon a sale, exchange or other taxable disposition of Common Shares, a U.S. Holder that makes a Mark-to-Market Election will recognize ordinary income or ordinary loss (not to exceed the excess, if any, of (a) the amount included in ordinary income because of such Mark-to-Market Election for prior tax years over (b) the amount allowed as a deduction because of such Mark-to-Market Election for prior tax years).
A U.S. Holder makes a Mark-to-Market Election by attaching a completed IRS Form 8621 to a timely filed U.S. federal income tax return. A timely Mark-to-Market Election applies to the tax year in which such Mark-to-Market Election is made and to each subsequent tax year, unless the Common Shares cease to be “marketable stock” or the IRS consents to revocation of such election. Each U.S. Holder should consult its own tax advisor regarding the availability of, and procedure for making, a Mark-to-Market Election.
Although a U.S. Holder may be eligible to make a Mark-to-Market Election with respect to the Common Shares, no such election may be made with respect to the stock of any Subsidiary PFIC that a U.S. Holder is treated as owning because such stock is not marketable. Hence, the Mark-to-Market Election will not be effective to eliminate the interest charge and other income inclusion rules described above with respect to deemed dispositions of Subsidiary PFIC stock or distributions from a Subsidiary PFIC to its shareholder.
Other PFIC Rules
Under Section 1291(f) of the Code, the IRS has issued proposed Treasury Regulations that, subject to certain exceptions, would cause a U.S. Holder that had not made a timely QEF Election to recognize gain (but not loss) upon certain transfers of Common Shares that would otherwise be tax-deferred (e.g., gifts and exchanges pursuant to corporate reorganizations). However, the specific U.S. federal income tax consequences to a U.S. Holder may vary based on the manner in which the Common Shares are transferred.
If finalized in their current form, the proposed Treasury Regulations applicable to PFICs would be effective for transactions occurring on or after April 1, 1992. Because the proposed Treasury Regulations have not yet been adopted in final form, they are not currently effective, and there is no assurance that they will be adopted in the form and with the effective date proposed. Nevertheless, the IRS has announced that, in the absence of final Treasury Regulations, taxpayers may apply reasonable interpretations of the Code provisions applicable to PFICs and that it considers the rules set forth in the proposed Treasury Regulations to be reasonable interpretations of those Code provisions. The PFIC rules are complex, and the implementation of certain aspects of the PFIC rules requires the issuance of Treasury Regulations which in many instances have not been promulgated and which, if promulgated, may have retroactive effect. U.S. Holders should consult their own tax advisors about the potential applicability of the proposed Treasury Regulations.
Certain additional adverse rules will apply with respect to a U.S. Holder if we are a PFIC, regardless of whether such U.S. Holder makes a QEF Election. For example, under Section 1298(b)(6) of the Code, a U.S. Holder that uses Common Shares as security for a loan will, except as may be provided in Treasury Regulations, be treated as having made a taxable disposition of such Common Shares.
In addition, a U.S. Holder who acquires Common Shares from a decedent will not receive a “step up” in the tax basis of such Common Shares to fair market value.
Special rules also apply to the amount of foreign tax credit that a U.S. Holder may claim on a distribution from a PFIC. Subject to such special rules, foreign taxes paid with respect to any distribution in respect of stock in a PFIC are generally eligible for the foreign tax credit. The rules relating to distributions by a PFIC and their eligibility for the foreign tax credit are complicated, and a U.S. Holder should consult with their own tax advisor regarding the availability of the foreign tax credit with respect to distributions by a PFIC.
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The PFIC rules are complex, and each U.S. Holder should consult its own tax advisor regarding the PFIC rules (including the applicability and advisability of a QEF Election and Mark-to-Market Election) and how the PFIC rules may affect the U.S. federal income tax consequences of the acquisition, ownership, and disposition of Common Shares.
General Rules Applicable to the Acquisition, Ownership, and Disposition of Common Shares
The following discussion describes the general rules applicable to the ownership and disposition of the Common Shares but is subject in its entirety to the special rules described above under the heading “Passive Foreign Investment Company Rules”.
Distributions on Common Shares
A U.S. Holder that receives a distribution, including a constructive distribution, with respect to an Common Share will be required to include the amount of such distribution in gross income as a dividend (without reduction for any Canadian income tax withheld from such distribution) to the extent of our current and accumulated “earnings and profits”, as computed under U.S. federal income tax principles. To the extent that a distribution exceeds our current and accumulated “earnings and profits”, such distribution will be treated first as a tax-free return of capital to the extent of a U.S. Holder’s tax basis in the Common Shares and thereafter as gain from the sale or exchange of such Common Shares (see “Sale, Exchange or Other Taxable Disposition of Common Shares” below). However, we may not maintain the calculations of earnings and profits in accordance with U.S. federal income tax principles, and each U.S. Holder may be required to assume that any distribution by us with respect to the Common Shares will constitute ordinary dividend income. Dividends received on Common Shares generally will not be eligible for the “dividends received deduction” generally applicable to corporations. Subject to applicable limitations and provided we are eligible for the benefits of the Convention or the Common Shares are readily tradable on a United States securities market, dividends paid by us to non-corporate U.S. Holders, including individuals, generally will be eligible for the preferential tax rates applicable to long-term capital gains for dividends, provided certain holding period and other conditions are satisfied, including that we not be classified as a PFIC in the tax year of distribution or in the preceding tax year. A dividend generally will be taxed to a U.S. Holder at ordinary income tax rates if we are a PFIC for the tax year of such distribution or the preceding tax year. The dividend rules are complex, and each U.S. Holder should consult its own tax advisor regarding the application of such rules.
Sale, Exchange or Other Taxable Disposition of Common Shares
Upon the sale, exchange or other taxable disposition of the Common Shares, a U.S. Holder generally will recognize capital gain or loss in an amount equal to the difference between (a) the amount of cash plus the fair market value of any property received and (b) such U.S. Holder’s tax basis in such Common Shares sold, exchanged or otherwise disposed of. Gain or loss recognized on such sale, exchange or other taxable disposition generally will be long-term capital gain or loss if, at the time of the sale or other taxable disposition, the Common Shares have been held for more than one year and will be short-term gain or loss if the holding period is equal to or less than one year. Preferential tax rates may apply to long-term capital gain of a U.S. Holder that is an individual, estate, or trust. There are no preferential tax rates for long-term capital gain of a U.S. Holder that is a corporation. For both corporate and non-corporate U.S. Holders, deductions for capital losses are subject to significant limitations under the Code.
Additional Tax Considerations
Receipt of Foreign Currency
The amount of any distribution paid to a U.S. Holder in foreign currency or on the sale, exchange or other taxable disposition of Common Shares generally will be equal to the U.S. dollar value of such foreign currency
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based on the exchange rate applicable on the date of receipt (regardless of whether such foreign currency is converted into U.S. dollars at that time). If the foreign currency received is not converted into U.S. dollars on the date of receipt, a U.S. Holder will have a tax basis in the foreign currency equal to its U.S. dollar value on the date of receipt. Any U.S. Holder who receives payment in foreign currency and engages in a subsequent conversion or other disposition of the foreign currency may have a foreign currency exchange gain or loss that would be treated as ordinary income or loss, and generally will be U.S. source income or loss for foreign tax credit purposes. Different rules apply to U.S. Holders who use the accrual method of tax accounting. Each U.S. Holder should consult its own tax advisor regarding the U.S. federal income tax consequences of receiving, owning, and disposing of foreign currency.
Foreign Tax Credit
Dividends paid on the Common Shares will be treated as foreign-source income, and generally will be treated as “passive category income” or “general category income” for U.S. foreign tax credit purposes. Any gain or loss recognized on a sale, exchange or other taxable disposition of Common Shares generally will be United States source gain or loss. Certain U.S. Holders that are eligible for the benefits of the Convention may elect to treat such gain or loss as Canadian source gain or loss for U.S. foreign tax credit purposes. The Code applies various complex limitations on the amount of foreign taxes that may be claimed as a credit by U.S. taxpayers. In addition, Treasury Regulations that apply to taxes paid or accrued (the “Foreign Tax Credit Regulations”) impose additional requirements for Canadian withholding taxes to be eligible for a foreign tax credit, and there can be no assurance that those requirements will be satisfied. The Treasury Department has released guidance temporarily pausing the application of certain of the Foreign Tax Credit Regulations.
Subject to the PFIC rules and the Foreign Tax Credit Regulations discussed above, a U.S. Holder that pays (whether directly or through withholding) Canadian income tax with respect to dividends paid on the Common Shares generally will be entitled, at the election of such U.S. Holder, to receive either a deduction or a credit for such Canadian income tax paid. Generally, a credit will reduce a U.S. Holder’s U.S. federal income tax liability on a dollar-for-dollar basis, whereas a deduction will reduce a U.S. Holder’s income subject to U.S. federal income tax. This election is made on a year-by-year basis and applies to all foreign taxes paid or accrued (whether directly or through withholding) by a U.S. Holder during a year. The foreign tax credit rules are complex and involve the application of rules that depend on a U.S. Holder’s particular circumstances. Accordingly, each U.S. Holder should consult its own tax advisor regarding the foreign tax credit rules.
Information Reporting and Backup Withholding Tax
Under U.S. federal income tax laws certain categories of U.S. Holders must file information returns with respect to their investment in, or involvement in, a foreign corporation. For example, U.S. return disclosure obligations (and related penalties) are imposed on U.S. Holders that hold certain specified foreign financial assets in excess of certain threshold amounts. The definition of specified foreign financial assets includes not only financial accounts maintained in foreign financial institutions, but also, unless held in accounts maintained by a financial institution, any stock or security issued by a non-U.S. person. U.S. Holders may be subject to these reporting requirements unless their Common Shares are held in an account at certain financial institutions. Penalties for failure to file certain of these information returns are substantial. U.S. Holders should consult their own tax advisors regarding the requirements of filing information returns, including the requirement to file IRS Form 8938.
Payments made within the U.S., or by a U.S. payor or U.S. middleman, of dividends on, and proceeds arising from the sale, exchange or other taxable disposition of the Common Shares generally may be subject to information reporting and backup withholding tax if a U.S. Holder (a) fails to furnish its correct U.S. taxpayer identification number (generally on IRS Form W-9), (b) furnishes an incorrect U.S. taxpayer identification number, (c) is notified by the IRS that such U.S. Holder has previously failed to properly report items subject to backup withholding tax, or (d) fails to certify, under penalty of perjury, that it has furnished its correct U.S.
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taxpayer identification number and that the IRS has not notified such U.S. Holder that it is subject to backup withholding tax. However, certain exempt persons, such as U.S. Holders that are corporations, generally are excluded from these information reporting and backup withholding tax rules. Backup withholding is not an additional tax. Any amounts withheld under the U.S. backup withholding tax rules will be allowed as a credit against a U.S. Holder’s U.S. federal income tax liability, if any, or will be refunded, if such U.S. Holder furnishes required information to the IRS in a timely manner.
The discussion of reporting requirements set forth above is not intended to constitute a complete description of all reporting requirements that may apply to a U.S. Holder. A failure to satisfy certain reporting requirements may result in an extension of the time period during which the IRS can assess a tax and, under certain circumstances, such an extension may apply to assessments of amounts unrelated to any unsatisfied reporting requirement. Each U.S. Holder should consult its own tax advisor regarding the information reporting and backup withholding rules.
THE ABOVE SUMMARY IS NOT INTENDED TO CONSTITUTE A COMPLETE ANALYSIS OF ALL U.S. FEDERAL INCOME TAX CONSIDERATIONS APPLICABLE TO U.S. HOLDERS WITH RESPECT TO THE ACQUISITION, OWNERSHIP, AND DISPOSITION OF COMMON SHARES. U.S. HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS AS TO THE TAX CONSIDERATIONS APPLICABLE TO THEM IN THEIR OWN PARTICULAR CIRCUMSTANCES.
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The validity of our Common Shares offered by this prospectus will be passed upon for us by Cassels Brock & Blackwell LLP, Toronto, Ontario. Certain legal matters in connection with this offering will be passed upon for us by Vinson & Elkins L.L.P., Houston, Texas. TD is being represented in connection with this offering by Skadden, Arps, Slate, Meagher & Flom LLP and Blake, Cassels & Graydon LLP.
The financial statements incorporated in this prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2024, have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in audit and accounting.
The estimates of mineral resources and mineral reserves and related information of the Project incorporated by reference herein are based upon analyses contained in the S-K 1300 Technical Report, with an effective date of December 31, 2024, and performed by SGS Canada Inc., Sawtooth Mining LLC, NewFields Mining Design & Technical Services, and EXP U.S. Services Inc. Such estimates and related information have been so incorporated in reliance upon the authority of such firms as experts in such matters.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on Form S-3 (including the exhibits, schedules and amendments thereto) under the Securities Act, with respect to our Common Shares offered hereby. This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules thereto. For further information with respect to us and the Common Shares offered hereby, we refer you to the registration statement and the exhibits and schedules filed therewith. Statements contained in this prospectus as to the contents of any contract, agreement or any other document are summaries of the material terms of such contract, agreement or other document and are not necessarily complete. With respect to each of these contracts, agreements or other documents filed as an exhibit to the registration statement, reference is made to the exhibits for a more complete description of the matter involved.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. Our registration statement, of which this prospectus constitutes a part, and the exhibits and schedules thereto can be downloaded from the SEC’s website. We file with or furnish to the SEC periodic reports and other information. These reports and other information may be obtained from the SEC’s website as provided above. Our website is located at www.lithiumamericas.com. We make our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports and other information filed with or furnished to the SEC available, free of charge, through our website, as soon as reasonably practicable after those reports and other information are electronically filed with or furnished to the SEC. Information on our website or any other website is not incorporated by reference into this prospectus and does not constitute a part of this prospectus, and investors should not rely on such information in making a decision to purchase our Common Shares.
We furnish or make available to our shareholders annual reports containing our audited financial statements prepared in accordance with U.S. GAAP. We also furnish or make available to our shareholders quarterly reports containing our unaudited interim financial information, including the information required by Form 10-Q, for the first three fiscal quarters of each fiscal year.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
We “incorporate by reference” into this prospectus documents we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus. Some information contained in this prospectus updates the information incorporated by reference, and information that we file subsequently with the SEC will automatically update this prospectus. In other words, in the case of a conflict or inconsistency between information set forth in this prospectus and information that we file later and incorporate by reference into this prospectus, you should rely on the information contained in the document that was filed later.
In particular, we incorporate by reference into this prospectus the documents listed below and any filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the initial filing and prior to effectiveness of the registration statement that contains this prospectus and prior to the time that all the Common Shares offered by this prospectus have been sold by the selling shareholder as described in this prospectus (other than, in each case, documents or information deemed to have been “furnished” and not “filed” in accordance with SEC rules) or such registration statement has been withdrawn:
| • | our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 28, 2025; |
| • | our Quarterly Report on Form 10-Q for the period ended March 31, 2025, filed with the SEC on May 15, 2025; |
| • | our Current Reports on Form 8-K, filed on January 7, 2025, January 7, 2025, March 11, 2025, March 28, 2025, and April 7, 2025 (except that, with respect to each of the foregoing Current Reports, any portion thereof which are furnished and not filed shall not be deemed incorporated by reference into this prospectus); and |
| • | the description of the Common Shares contained in our Registration Statement on Form 20-F, filed with the SEC on August 22, 2023, as amended, and declared effective by the SEC on September 28, 2023, including any amendment or report filed for the purpose of amending such description. |
Any statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus will be deemed to be modified or superseded to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference in this prospectus modifies or supersedes that statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
You may request a copy of the registration statement, the above filings and any future filings that are incorporated by reference into this prospectus, other than an exhibit to a filing unless that exhibit is specifically incorporated by reference into that filing, at no cost, by writing or calling us at the following address:
3260 – 666, Burrard Street
Vancouver, BC V6C 2X8
(778) 656-5820
Attention: Investor Relations
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Lithium Americas Corp.
Up to $100,000,000
Common Shares
PROSPECTUS
TD Securities
, 2025
Table of Contents
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
| Item 14. | Other Expenses of Issuance and Distribution. |
The following table sets forth the fees and expenses, other than underwriting discounts and commissions, payable by us in connection with the resale of the Common Shares being registered hereby.
| SEC registration fee |
$ | 104,337 | ||
| FINRA filing fee |
* | |||
| Accounting fees and expenses |
* | |||
| Legal fees and expenses |
* | |||
| Printing and engraving expenses |
* | |||
| Transfer agent and registrar fee |
* | |||
| Miscellaneous |
* | |||
| Total |
$ | * |
| * | These fees are calculated based on the securities offered and the number of issuances and accordingly cannot be defined at this time. |
We will bear all costs, expenses and fees in connection with the registration of the Common Shares, including with regard to compliance with state securities or “blue sky” laws. The selling shareholder, however, will bear all commissions and discounts, if any, attributable to its sale of the Common Shares.
| Item 15. | Indemnification of Directors and Officers. |
Section 160 of the BCBCA provides that the Company may do one or both of the following:
| (a) | indemnify an eligible party (as defined below) against all eligible penalties (as defined below) to which the eligible party is or may be liable; |
| (b) | after the final disposition of an eligible proceeding (as defined below), pay certain expenses (as defined below) actually or reasonably incurred by an eligible party in respect of that proceeding. |
However, after the final disposition of an eligible proceeding, the Company must pay certain expenses actually and reasonably incurred by an eligible party in respect of that proceeding if the eligible party: (i) has not been reimbursed for those expenses; and (ii) is wholly successful, on the merits or otherwise, in the outcome of the proceeding or is substantially successful on the merits in the outcome of the proceeding. The BCBCA also provides that the Company may pay, as they are incurred in advance of the final disposition of an eligible proceeding, the expenses actually and reasonably incurred by an eligible party in respect of that proceeding provided the Company first receives from the eligible party a written undertaking that, if it is ultimately determined that the payment of expenses is prohibited under the BCBCA, the eligible party will repay the amounts advanced.
For the purposes of the applicable division of the BCBCA, an “eligible party”, in relation to the Company, means an individual who:
| (a) | is or was a director or officer of the Company; |
| (b) | is or was a director or officer of another corporation at a time when the corporation is or was an affiliate of the Company, or at the request of the Company; or |
| (c) | at the request of the Company, is or was, or holds or held a position equivalent to that of, a director or officer of a partnership, trust, joint venture or other unincorporated entity, |
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and includes, with some exceptions, the heirs and personal or other legal representatives of that individual.
“Eligible penalty” under the BCBCA means a judgment, penalty or fine awarded or imposed in, or an amount paid in settlement of, an eligible proceeding.
“Eligible proceeding” under the BCBCA is a proceeding in which an eligible party or any of the heirs and personal or other legal representatives of the eligible party, by reason of the eligible party being or having been a director or officer of, or holding or having held a position equivalent to that of a director or officer of, the Company or an associated corporation, is or may be joined as a party, or is or may be liable for or in respect of a judgment, penalty or fine in, or expenses related to, the proceeding.
“Proceeding” includes any legal proceeding or investigative action, whether current, threatened, pending or completed.
“Expenses” include costs, charges and expenses, including legal and other fees, but does not include judgments, penalties, fines or amounts paid in settlement of a proceeding.
“Associated corporation” means a corporation or entity referred to in paragraph (b) or (c) of the definition of “eligible party” above.
Notwithstanding the foregoing, the BCBCA prohibits the Company from indemnifying an eligible party or paying the expenses of an eligible party if any of the following circumstances apply:
| (a) | if the indemnity or payment is made under an earlier agreement to indemnify or pay expenses and, at the time such agreement to indemnify or pay expenses was made, the Company was prohibited from giving the indemnity or paying the expenses by its memorandum or articles; |
| (b) | if the indemnity or payment is made otherwise than under an earlier agreement to indemnify or pay expenses and, at the time that the indemnity or payment is made, the Company is prohibited from giving the indemnity or paying the expenses by its memorandum or articles; |
| (c) | if, in relation to the subject matter of the eligible proceeding, the eligible party did not act honestly and in good faith with a view to the best interest of the Company or the associated corporation, as the case may be; or |
| (d) | in the case of an eligible proceeding other than a civil proceeding, if the eligible party did not have reasonable grounds for believing that the eligible party’s conduct in respect of which the proceeding was brought was lawful. |
Additionally, if an eligible proceeding is brought against an eligible party by or on behalf of the Company or an associated corporation, the Company must not indemnify the eligible party or pay or advance the expenses of the eligible party in respect of that proceeding.
Whether or not payment of expenses or indemnification has been sought, authorized or declined under the BCBCA, Section 164 of the BCBCA provides that, on the application of the Company or an eligible party, the Supreme Court of British Columbia may do one or more of the following:
| (a) | order the Company to indemnify an eligible party against any liability incurred by the eligible party in respect of an eligible proceeding; |
| (b) | order the Company to pay some or all of the expenses incurred by an eligible party in respect of an eligible proceeding; |
| (c) | order the enforcement of, or any payment under, an agreement of indemnification entered into by the Company; |
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| (d) | order the Company to pay some or all of the expenses actually and reasonably incurred by any person in obtaining an order under Section 164; or |
| (e) | make any other order the court considers appropriate. |
The BCBCA provides that the Company may purchase and maintain insurance for the benefit of an eligible party or the heirs and personal or other legal representatives of the eligible party against any liability that may be incurred by reason of the eligible party being or having been a director or officer of, or holding or having held a position equivalent to that of a director or officer of, the Company or an associated corporation.
The Company’s Articles provide that, subject to the BCBCA, the Company must indemnify a director, former director or alternate director of the Company and his or her heirs and legal personal representatives against all eligible penalties to which such person is or may be liable, and the Company must, after the final disposition of an eligible proceeding, pay certain expenses actually and reasonably incurred by such person in respect of that proceeding. Each director and alternate director is deemed to have contracted with the Company on the terms of the indemnity above.
The Company’s Articles define “eligible penalty” to mean a judgment, penalty or fine awarded or imposed in, or an amount paid in settlement of, an eligible proceeding. The Company’s Articles further define an “eligible proceeding” to mean a legal proceeding or investigative action, whether current, threatened, pending or completed, in which a director, former director or alternate director of the Company (an “eligible party”) or any of the heirs and legal personal representatives of the eligible party, by reason of the eligible party being or having been a director or alternate director of the Company (a) is or may be joined as a party; or (b) is or may be liable for or in respect of a judgment, penalty or fine in, or expenses related to, the proceeding.
The Company’s Articles further provide that subject to any restrictions in the BCBCA, the Company may indemnify any person. The failure of a director, alternate director or officer of the Company to comply with the BCBCA or the Company’s Articles does not invalidate any indemnity to which he or she is entitled under the Company’s Articles.
The Company is authorized by its Articles to purchase and maintain insurance for the benefit of any person (or his or her heirs or legal personal representatives) who: (i) is or was a director, alternate director, officer, employee or agent of the Company; (ii) is or was a director, alternate director, officer, employee or agent of a corporation at a time when the corporation is or was an affiliate of the Company; (iii) at the request of the Company, is or was a director, alternate director, officer, employee or agent of a corporation or of a partnership, trust, joint venture or other unincorporated entity; (iv) at the request of the Company, holds or held a position equivalent to that of a director, alternate director or officer of a partnership, trust, joint venture or other unincorporated entity; against any liability incurred by him or her as such director, alternate director, officer, employee or agent or person who holds or held such equivalent position.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions, the Company has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
| Item 16. | Exhibits. |
| Exhibit No. | Description | |
| 1.1*** | Form of Underwriting Agreement for each of the securities registered hereby. | |
| 1.2*#+ | Equity Distribution Agreement, dated May 15, 2025, by and among Lithium Americas Corp., TD Securities (USA) LLC and TD Securities Inc. | |
| 4.1*** | Form of Share Certificate for the Preferred Shares. | |
| 4.2*** | Specimen Preferred Stock Certificate of Lithium Americas Corp. | |
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| * | Filed herewith. |
| *** | To be filed by amendment. |
| # | Certain annexes, schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Corporation agrees to furnish supplementally an unredacted copy of the exhibit to the Securities and Exchange Commission upon its request. |
| + | Certain portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The Corporation agrees to furnish supplementally an unredacted copy of the exhibit to the Securities and Exchange Commission upon its request. |
| Item 17. | Undertakings. |
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the
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Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
| (1) | The undersigned registrant hereby undertakes: |
| (a) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| (i) | To include any prospectus required by Section 10(a)(3) of the Securities Act; |
| (ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424 (b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; |
| (iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
provided, however, that paragraphs (i), (ii) and (iii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in this registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
| (b) | That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| (c) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
| (d) | That, for the purpose of determining liability under the Securities Act to any purchaser: |
| (i) | Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and |
| (ii) | Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415 (a)(1)(i), (vii), or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person |
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| that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date. |
| (e) | That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities: |
The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
| (i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
| (iv) | any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
| (2) | The undersigned registrant hereby undertakes that: |
| (a) | For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. |
| (b) | For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| (3) | The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
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SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Vancouver, Province of British Columbia, on May 15, 2025.
| LITHIUM AMERICAS CORP. | ||
| By:
|
/s/ Jonathan Evans | |
| Name: | Jonathan Evans | |
| Title: | Chief Executive Officer | |
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Jonathan Evans, Luke Colton and Edward Grandy his or her true and lawful attorneys-in-fact and agents, each with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments, including post-effective amendments, to this registration statement, and any registration statement relating to the offering covered by this registration statement and filed pursuant to Rule 462(b) under the Securities Act of 1933, and to file the same, with exhibits thereto and other documents in connection therewith, with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that each of said attorneys-in-fact and agents, or his or her substitute or substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated below on May 15, 2025.
| /s/ Jonathan Evans Jonathan Evans |
Director, President and Chief Executive Officer (Principal Executive Officer) | |
| /s/ Luke Colton Luke Colton |
Executive Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | |
| /s/ Kelvin Dushnisky Kelvin Dushnisky |
Director and Executive Chair | |
| /s/ Yuan Gao Yuan Gao |
Lead Independent Director | |
| /s/ Michael Brown Michael Brown |
Director | |
| /s/ Fabiana Chubbs Fabiana Chubbs |
Director | |
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| /s/ Zach Kirkman Zach Kirkman |
Director | |
| /s/ Jinhee Magie Jinhee Magie |
Director | |
| /s/ Philip Montgomery Philip Montgomery |
Director | |
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AUTHORIZED REPRESENTATIVE
Pursuant to the requirements of Section 6(a) of the Securities Act, the undersigned as signed this Registration Statement, solely in the capacity of the duly authorized representative of Lithium Americas Corp. in the United States, on May 15, 2025.
| By:
|
/s/ Edward Grandy | |
| Name: | Edward Grandy | |
| Title: | Senior Vice President, General Counsel and Corporate Secretary |
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Certain identified information in this Agreement denoted with “[***]” has been excluded from this exhibit pursuant to Item 601(b)(10)(iv) of Regulation S-K because it is both not material and of the type that the registrant treats as private and confidential.
EQUITY DISTRIBUTION AGREEMENT
May 15, 2025
TD Securities Inc.
66 Wellington Street West, 10th Floor
Toronto, Ontario M5K 1A2
TD Securities (USA) LLC
1 Vanderbilt Avenue
New York, New York 10017
Ladies and Gentlemen:
Lithium Americas Corp., a company incorporated under the laws of the Province of British Columbia, Canada (the “Company”), proposes, subject to the terms and conditions stated herein, to issue and sell from time to time through TD Securities (USA) LLC (the “U.S. Agent”) and TD Securities Inc. (the “Canadian Agent” and, together with the U.S. Agent, the “Agents” and each an “Agent”), as sales agents and/or principals, the common shares in the capital of the Company, without par value (the “Common Shares”), having an aggregate offering price of up to US$100,000,000 (or the equivalent in Canadian dollars determined using the daily exchange rate posted by the Bank of Canada on the date the Common Shares are sold) on the terms set forth in this agreement (this “Agreement”).
Section 1. DEFINITIONS
(a) Certain Definitions. For purposes of this Agreement, capitalized terms used herein and not otherwise defined shall have the following respective meanings:
“Affiliate” of a Person means another Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first- mentioned Person. The term “control” (including the terms “controlling,” “controlled by” and “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
“Agency Period” means the period commencing on the date of this Agreement and expiring on the earliest to occur of (x) the date on which the Agents shall have placed the Maximum Program Amount pursuant to this Agreement, (y) the date this Agreement is terminated pursuant to Section 7, and (z) December 9, 2025.
“Commission” means the United States Securities and Exchange Commission.
“Environmental Laws” means all applicable laws relating to worker health and safety, pollution, natural resources, protection and preservation of the natural environment or any species that might make use of it or the generation, production, import, export, use, handling, storage, treatment, transportation, disposal or release of Hazardous Materials, including under common law, and all authorizations issued pursuant to such applicable laws.
“Environmental Permits” includes all order, directive, judgment, decree, injunction, decision, ruling, award or writ of any governmental or regulatory authority, permits, certificates, approvals, consents, registrations and licenses issued by, or required to be obtained from, any authority of competent jurisdiction under any Environmental Law.
“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder.
“Floor Price” means the minimum price set by the Company in the Issuance Notice below which the relevant Agent shall not sell Shares during the applicable period set forth in the Issuance Notice, which may be adjusted by the Company at any time during the period set forth in the Issuance Notice by delivering written notice of such change to the relevant Agent.
“Hazardous Materials” means any pollutant, contaminant or hazardous or toxic substance, material or waste that is regulated by or forms the basis of liability under, any Environmental Law, including, without limitation, (i) any material, substance or waste that is defined as a “hazardous waste”, “hazardous material”, “hazardous substance”, “extremely hazardous waste”, “restricted hazardous waste”, “pollutant”, “contaminant”, “hazardous constituent”, “special waste”, “toxic substance” or other similar term or phrase under any Environmental Law, (ii) petroleum, petroleum hydrocarbons, petroleum products, crude oil or any fraction or by-product derivatives thereof, (iii) asbestos, (iv) polychlorinated biphenyls, or (v) any radioactive substance.
“Issuance Amount” means the aggregate Sales Price of the Shares to be sold by the Agents pursuant to any Issuance Notice.
“Issuance Notice” means a written notice delivered to any of the Agents by the Company in accordance with this Agreement in the form attached hereto as Exhibit A that is executed by its Chief Executive Officer or Chief Financial Officer.
“Issuance Notice Date” means any Trading Day during the Agency Period that an Issuance Notice is delivered pursuant to Section 3(b)(i).
“Maximum Program Amount” means Shares with an aggregate Sales Price of up to US$100,000,000 (or the equivalent in Canadian dollars determined using the daily exchange rate posted by the Bank of Canada on the date the Shares are sold).
“Mineral Property” means the Thacker Pass Project.
“Net Issuance Price” means the Sales Price less the Selling Commission.
“NYSE” means the New York Stock Exchange.
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“Person” means an individual or a corporation, partnership, limited liability company, trust, incorporated or unincorporated association, joint venture, joint stock company, governmental authority or other entity of any kind.
“Personal Data” means (i) a natural person’s name, street address, telephone number, e-mail address, photograph, social security number or tax identification number, driver’s license number, passport number, credit card number, bank information, or customer or account number; (ii) any information which would qualify as “personally identifying information” under the Federal Trade Commission Act, as amended; (iii) “personal data” as defined by GDPR (as hereinafter defined); (iv) any information which would qualify as “protected health information” under the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act; and (v) any other piece of information that allows the identification of such natural person, or his or her family, or permits the collection or analysis of any data related to an identified person’s health or sexual orientation.
“Release” means any release, spill, emission, leaking, pumping, pouring, injection, deposit, disposal, emptying, escaping, discharge, dispersal, dumping, leaching or migration of Hazardous Materials into the environment.
“Sales Price” means the actual sale execution price of each Share placed by any of the Agents pursuant to this Agreement.
“Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder.
“Selling Commission” means up to three percent (3.0%) of the gross proceeds of Shares sold pursuant to this Agreement, or as otherwise agreed between the Company and the Agents with respect to any Shares sold pursuant to this Agreement.
“Settlement Date” means the first business day following each Trading Day during the period set forth in the Issuance Notice on which Shares are sold pursuant to this Agreement, when the Company shall deliver to the applicable Agent the number of Shares sold on such Trading Day and such Agent shall deliver to the Company the aggregate Net Issuance Price received on such sales.
“Shares” shall mean the Company’s Common Shares issued or issuable pursuant to this Agreement.
“Technical Reports” means the technical report titled “NI 43-101 Technical Report on the Thacker Pass Project Humboldt County, Nevada, USA” dated January 7, 2025 with an effective date of December 31, 2024 and the technical report titled “S-K 1300 Technical Report on the Thacker Pass Project Humboldt County, Nevada, USA” dated January 7, 2025 with an effective date of December 31, 2024.
“Thacker Pass Project” means the Company’s sedimentary-based lithium deposit project property located in the McDermitt Caldera in Humboldt County, Nevada.
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“Time of Sale” means each relevant time Shares are sold pursuant to this Agreement.
“Threatened Release” means a substantial likelihood of a sudden Release that requires immediate action to prevent or mitigate damage to the environment that may result from such a Release.
“Trading Day” means any day on which the TSX or the NYSE is open for trading.
“TSX” means the Toronto Stock Exchange.
Section 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to, and agrees with, the Agents that as at (1) the date of this Agreement, (2) each Issuance Notice Date, (3) each Settlement Date, (4) each Triggering Event Date on which a certificate is required to be delivered pursuant to Section 4(o), and (5) each Time of Sale (each of the times referenced above is referred to herein as a “Representation Date”), except as may be disclosed in the Registration Statement and the Prospectuses (including any documents incorporated by reference therein and any supplements thereto) on or before a Representation Date, and except as any such representation or warranty is, by its express terms, limited to a specific date:
(a) Registration Statement and Prospectuses. The Company has prepared and filed with the securities regulatory authorities (the “Canadian Qualifying Authorities”), in each of the provinces and territories of Canada (the “Canadian Qualifying Jurisdictions”), a preliminary short form base shelf prospectus dated October 30, 2023 (the “Canadian Preliminary Base Prospectus”) and a final short form base shelf prospectus dated November 8, 2023, in respect of an aggregate of up to US$750,000,000 (or the equivalent thereof, at the date of issue, in Canadian dollars or any other currency or currencies, as the case may be) in certain securities of the Company, including the Common Shares (collectively, the “Shelf Securities”) in each case in accordance with the applicable securities laws of each of the Canadian Qualifying Jurisdictions and the respective applicable rules and regulations under such laws, together with applicable published national, multilateral and local policy statements, instruments, notices and blanket orders of the Canadian Qualifying Authorities in each of the Canadian Qualifying Jurisdictions, as modified by the Translation Decision (as defined below) (collectively, “Canadian Securities Laws”). The British Columbia Securities Commission (the “Reviewing Authority”) is the principal regulator of the Company under the passport system procedures provided for under Multilateral Instrument 11-102 – Passport System and National Policy 11-202 – Process for Prospectus Reviews in Multiple Jurisdictions in respect of the offering of the Shelf Securities. The Reviewing Authority has issued a receipt evidencing that a receipt has been issued or been deemed to be issued (a “Receipt”) (i) by the Reviewing Authority and the regulators in each of the other Canadian Qualifying Jurisdictions for the Canadian Preliminary Base Prospectus, and (ii) by the Reviewing Authority and the regulators in each of the other Canadian Qualifying Jurisdictions for the Canadian Base Prospectus. The term “Canadian Base Prospectus” means the final short form base shelf prospectus dated November 8, 2023 relating to the Shelf Securities, including any documents incorporated by reference therein and the documents otherwise deemed to be a part thereof or included therein pursuant to Canadian Securities Laws, including National Instrument 44-101 – Short Form Prospectus Distributions (“NI 44-101”) and National Instrument 44-102 – Shelf Distributions (“NI 44-102” and together with NI 44-101, the “Canadian Shelf Procedures”). As used herein, “Canadian Prospectus Supplement” means the prospectus
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supplement to the Canadian Base Prospectus relating to the Shares, to be filed by the Company with the Canadian Qualifying Authorities in accordance with Canadian Securities Laws; “Canadian Prospectuses” means the Canadian Prospectus Supplement (and any additional Canadian prospectus supplement relating to the Shares prepared in accordance with the provisions of this Agreement and filed with the Canadian Qualifying Authorities in accordance with Canadian Securities Laws) together with the Canadian Base Prospectus; and a “Designated News Release” means a news release disseminated by the Company in respect of previously undisclosed information that, in the Company’s determination, constitutes a “material fact” (as such term is defined in Canadian Securities Laws) and identified by the Company as a “designated news release” for the purposes of the Canadian Prospectus Supplement and the Canadian Base Prospectus in writing on the face page of the version of such news release that is filed by the Company on the System for Electronic Data Analysis and Retrieval + (“SEDAR+”). The Canadian Prospectus Supplement shall provide that any and all Designated News Releases shall be deemed to be incorporated by reference therein and in the Canadian Base Prospectus but only for the purposes of the at-the-market program contemplated by this Agreement. The “Translation Decision” means the decision of the Autorité des marchés financiers dated October 26, 2023 obtained by the Company granting exemptive relief from the requirement that the Canadian Prospectuses be publicly filed in both the French and English languages. For the purposes of the Canadian Prospectuses, the Company is not required to publicly file French versions of the Canadian Prospectuses and the documents incorporated by reference therein.
The Company will also prepare and file with the Commission, in accordance with the provisions of the Securities Act, and the rules and regulations thereunder (the “Rules and Regulations”), a registration statement on Form S-3 (the “Initial Registration Statement”) including a related prospectus (the “U.S. Base Prospectus”) covering the registration of the Shares under the Securities Act and the Rules and Regulations. As soon as practicable following the date that such Registration Statement is declared effective, the Company shall furnish to the Agents, for use by the Agents, copies of the U.S. Prospectus (as defined below). Except where the context otherwise requires, such Initial Registration Statement, and any post-effective amendment thereto, as amended when it becomes effective, including all documents filed as part thereof or incorporated by reference therein, and including any information contained in a Prospectus (as defined below) subsequently filed with the Commission pursuant to Rule 424(b) under the Securities Act or deemed to be a part of such registration statement pursuant to Rule 430B or 462(b) of the Securities Act, is herein called the “Registration Statement.” Any registration statement and amendments thereto filed pursuant to Rule 462(b) of the Securities Act and relating to the offering covered by the Registration Statement is herein called a “Rule 462(b) Registration Statement” and, after such filing, the “Registration Statement” shall include any Rule 462(b) Registration Statement. The U.S. Base Prospectus, including all documents incorporated therein by reference, included in the Registration Statement, as it may be supplemented by any additional prospectus supplement, in the form in which such U.S. Base Prospectus and/or additional prospectus supplement have most recently been filed by the Company with the Commission pursuant to Rule 424(b) under the Securities Act, together with any “issuer free writing prospectus,” as defined in Rule 433 under the Securities Act (“Rule 433”), relating to the Shares, is herein called the “U.S. Prospectus.” “Base Prospectuses” means, collectively, the Canadian Base Prospectus and the U.S. Base Prospectus; and “Prospectuses” means, collectively, the Canadian Prospectuses and the U.S. Prospectus.
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Any reference herein to the Registration Statement, the Base Prospectuses, the Canadian Prospectus Supplement or the Prospectuses or any amendment or supplement thereto shall be deemed to refer to and include the documents incorporated by reference therein, and any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the Base Prospectuses, the Canadian Prospectus Supplement or the Prospectuses shall be deemed to refer to and include the filing or furnishing of any document with or to the Commission or Canadian Qualifying Authorities, as applicable, on or after the effective date of the Registration Statement or the date of the Base Prospectuses, the Canadian Prospectus Supplement or the Prospectuses, as the case may be, and deemed to be incorporated by reference therein. For purposes of this Agreement, all references to the Canadian Base Prospectus, the Canadian Prospectus Supplement and the Canadian Prospectuses or any amendment or supplement thereto shall be deemed to include any copy filed with any Canadian Qualifying Authority on SEDAR+ and all references to the Registration Statement, the U.S. Base Prospectus and the U.S. Prospectuses or any amendment or supplement thereto shall be deemed to include any copy filed with the Commission pursuant to the Electronic Data Gathering Analysis and Retrieval System (“EDGAR”).
All references in this Agreement to financial statements and schedules and other information which is “contained,” “included” or “stated” in the Registration Statement or the U.S. Prospectuses (or other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information which is incorporated by reference into or otherwise deemed by the Rules and Regulations to be a part of or included in the Registration Statement or the U.S. Prospectuses, as the case may be, as of any specified date. All references in this Agreement to financial statements and other information which is “described,” “contained,” “included” or “stated” in the Canadian Prospectuses (or other references of like import) shall be deemed to mean and include all such financial statements and other information which is incorporated by reference into or otherwise deemed by Canadian Securities Laws to be a part of or included in the Canadian Prospectuses, as the case may be, as of any specified date.
(b) Compliance with Registration Requirements. The Company meets the general eligibility requirements for the use of the Canadian Shelf Procedures and for the use of a short form base shelf prospectus with respect to a distribution of securities. The Reviewing Authority has issued the Receipt on behalf of itself and the other Canadian Qualifying Authorities for the Canadian Base Prospectus. Subsequent to the issuance of the Receipt for the Canadian Base Prospectus, no other document with respect to the Canadian Base Prospectus has heretofore been filed with the Canadian Qualifying Authorities, except for any document filed with the Canadian Qualifying Authorities subsequent to the date of such Receipt in the form heretofore delivered to the Agents or made available to the Agents on SEDAR+. No order, ruling or determination having the effect of suspending the sale or ceasing the trading of the Common Shares or any other securities of the Company has been issued or made by any Canadian Qualifying Authority, any other securities commission, stock exchange or other regulatory authority and no proceedings for that purpose have been initiated or are pending or, to the knowledge of the Company, are contemplated or threatened by any Canadian Qualifying Authority, any other securities commission, stock exchange or other regulatory authority, and any request made to the Company on the part of any Canadian Qualifying Authority, any other securities commission, stock exchange or other regulatory authority for additional information has been complied with.
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Prior to the issuance of any Issuance Notice by the Company, the Registration Statement shall have been filed and declared effective by the Commission under the Securities Act. At the time the Registration Statement is declared effective, the Company will meet, and as of the date hereof the Company meets, the then-applicable requirements for use of Form S-3 under the Securities Act. During the Agency Period, each time the Company files an annual report on Form 10-K, the Company will meet the then-applicable requirements for use of Form S-3 under the Securities Act. The Company will comply to the Commission’s satisfaction with all requests of the Commission for additional or supplemental information. Any amendment or supplement to the Registration Statement or the U.S. Prospectuses required by this Agreement will be so prepared and filed by the Company and, as applicable, the Company will use commercially reasonable efforts to cause it to become effective as soon as reasonably practicable. No stop order suspending the effectiveness of the Registration Statement has been issued, and no proceeding for that purpose has been instituted or, to the knowledge of the Company, threatened by the Commission. No order preventing or suspending the use of the U.S. Prospectuses or any Free Writing Prospectus (as hereinafter defined) has been issued by the Commission. Copies of all filings made by the Company under the Securities Act and all documents that were filed with the Commission have either been delivered to the Agents or made available to the Agents on EDGAR. Copies of all filings made by the Company under the Canadian Securities Laws that were filed or furnished with the Commission have either been delivered to the Agents or made available to the Agents on SEDAR+.
The Canadian Prospectuses, at the time of filing thereof with the Canadian Qualifying Authorities, complied and, as amended or supplemented, if applicable, will comply in all material respects with Canadian Securities Laws. The Canadian Prospectuses, as amended or supplemented, as of their respective dates, did not, and, as of each Time of Sale and Settlement Date, if any, will not contain a misrepresentation, as defined under Canadian Securities Laws. The representations and warranties set forth in the two immediately preceding sentences do not apply to statements in or omissions from the Canadian Prospectuses, or any amendments or supplements thereto, made in reliance upon and in conformity with information relating to the Agents furnished to the Company in writing by or on behalf of the Agents expressly for use therein. The U.S. Prospectuses, at the time first filed in accordance with Rule 424(b) under the Securities Act, conformed and, as amended or supplemented, if applicable, will conform in all material respects with the provisions of the Securities Act and the Rules and Regulations.
The U.S. Prospectuses when filed will comply in all material respects with the applicable provisions of the Securities Act and, if filed with the Commission through EDGAR (except as may be permitted by Regulation S-T under the Securities Act), will be identical to the copy thereof delivered to the Agents for use in connection with the issuance and sale of the Shares.
Each of the Registration Statement and any post-effective amendment thereto, at the time it becomes effective and at all subsequent times, will comply in all material respects with the Securities Act and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The U.S. Prospectuses, as amended or supplemented, as of their respective dates and at all subsequent times, will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The representations and warranties set forth in the two immediately preceding sentences do not apply to statements in or omissions from the Registration
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Statement or any post-effective amendment thereto, or the U.S. Prospectuses, or any amendments or supplements thereto, made in reliance upon and in conformity with information relating to the Agents furnished to the Company in writing by or on behalf of the Agents expressly for use therein. There are no material contracts or other documents required to be described in the Prospectuses or to be filed as exhibits to the Registration Statement which have not been described or filed as required. The Registration Statement and the offer and sale of the Shares as contemplated hereby meet the requirements of Rule 415 of the Securities Act and comply in all material respects with said rule.
(c) Ineligible Issuer Status. The Company is not an “ineligible issuer” in connection with the offering of the Shares pursuant to Rules 164, 405 and 433 under the Securities Act. Any Free Writing Prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act. Each Free Writing Prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or will comply in all material respects with the requirements of Rule 433 under the Securities Act including timely filing with the Commission or retention where required and legending, and each such Free Writing Prospectus, as of its issue date and at all subsequent times through the completion of the issuance and sale of the Shares did not, does not and will not include any information that conflicted, conflicts with or will conflict with the information contained in the Registration Statement or the Prospectuses, including any document incorporated by reference therein. Except for the Free Writing Prospectuses, if any, and electronic road shows, if any, furnished to the Agents before first use, the Company has not prepared, used or referred to, and will not, without the Agents’ prior consent, prepare, use or refer to, any Free Writing Prospectus in connection with the offering contemplated under this Agreement.
(d) Incorporated Documents. The documents incorporated or deemed to be incorporated by reference into the Registration Statement and the Prospectuses, at the time they were filed with the Commission or the Canadian Qualifying Authorities, as applicable, complied in all material respects with the requirements of the Exchange Act and Canadian Securities Laws, as applicable, and, when read together with the other information in the Prospectuses, do not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading or contain a misrepresentation, as defined under Canadian Securities Laws.
(e) Compliance. The documents incorporated or deemed to be incorporated by reference into the Registration Statement and the Prospectuses, at the time they were or hereafter are filed with the Commission or the Canadian Qualifying Authorities, as applicable, and any Free Writing Prospectus or amendment or supplement to the U.S. Prospectuses, complied and will comply in all material respects with the requirements of the Exchange Act and Canadian Securities Laws, as applicable, and, when read together with the other information in the Prospectuses, at the time the Registration Statement and any amendments thereto become effective and on the date the receipt was issued for the Canadian Base Prospectus and at each Time of Sale and Settlement Date, as the case may be, will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make a statement therein, in the light of the circumstances under which it was made, not misleading or contain a misrepresentation, as defined under Canadian Securities Laws.
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(f) Statistical and Market-Related Data. Any statistical, demographic and market-related data included in the Registration Statement or the Prospectuses are based on or derived from sources that the Company believes to be reliable and accurate in all material respects. To the extent required under applicable laws, the Company has obtained the written consent for the use of such data from such sources.
(g) Disclosure Controls and Procedures; Deficiencies in or Changes to Internal Control Over Financial Reporting. The Company and its subsidiaries (as hereinafter defined), on a consolidated basis, have established and maintain disclosure controls and procedures (as defined in Canadian Securities Laws and applicable U.S. securities laws) that (i) are designed to provide reasonable assurance that information required to be disclosed by the Company in its annual filings, interim filings or other reports filed or submitted by it under Canadian Securities Laws and applicable U.S. securities laws is recorded, processed, summarized and reported within the time periods specified in the Canadian Securities Laws and applicable U.S. securities laws and include controls and procedures designed to ensure that information required to be disclosed by the Company in its annual filings, interim filings or other reports filed or submitted under Canadian Securities Laws and applicable U.S. securities laws is accumulated and communicated to the Company’s management, including its certifying officers, as appropriate to allow timely decisions regarding required disclosure; (ii) have been evaluated by management of the Company for effectiveness in accordance with Canadian Securities Laws and applicable U.S. securities laws as of the end of the Company’s most recent audited fiscal year; and (iii) are effective in all material respects to perform the functions for which they were established as of the end of the Company’s most recent audited fiscal year. Since the end of the Company’s most recent audited fiscal year up to the end of the Company’s most recent reported interim financial period, other than as may be publicly disclosed by the Company, there have been no significant limitations or material weaknesses, in each case, in the Company’s design of its internal control over financial reporting (whether or not remediated) and no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
(h) This Agreement. This Agreement has been authorized, executed and delivered by the Company and, when executed and delivered in accordance with its terms, will constitute a valid and legally binding agreement of the Company enforceable against the Company in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforceability of creditors’ rights generally or by equitable principles relating to enforceability.
(i) Authorization of the Shares. The Shares have been authorized for issuance and sale pursuant to this Agreement and, when issued and delivered by the Company against payment therefor pursuant to this Agreement, will be validly issued, fully paid and non-assessable, and except as disclosed in the Registration Statement and the Prospectuses, the issuance and sale of the Shares is not subject to any preemptive rights, rights of first refusal or other similar rights to subscribe for or purchase the Shares.
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(j) No Applicable Registration or Other Similar Rights. Except as disclosed in the Registration Statement and the Prospectuses, there are no persons with registration or other similar rights to have any equity or debt securities registered for sale under the Registration Statement or the Prospectuses or included in the offering contemplated by this Agreement, except where the failure to receive a waiver of such rights would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change (as hereinafter defined).
(k) No Material Adverse Change. Except as disclosed in the Registration Statement and the Prospectuses, subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectuses: (i) there has been no material adverse change, or any development that would reasonably be expected to result in a material adverse change, in (A) the condition, financial or otherwise, or in the earnings, business, properties, operations, operating results, assets, liabilities or prospects, whether or not arising from transactions in the ordinary course of business, of the Company and its subsidiaries, considered as one entity, or (B) the ability of the Company to consummate the transactions contemplated by this Agreement or perform its obligations hereunder (any such change being referred to herein as a “Material Adverse Change”); and (ii) there has not been any material increase in any short-term or long-term indebtedness of the Company or its subsidiaries, considered on a consolidated basis, and there has been no dividend or distribution of any kind declared, paid or made by the Company or, except for dividends paid to the Company or other subsidiaries, by any of the Company’s subsidiaries on any class of capital stock, or any repurchase or redemption by the Company or any of its subsidiaries of any class of capital stock.
(l) Independent Auditors; No Reportable Event. PricewaterhouseCoopers LLP, which has expressed its opinion with respect to the annual consolidated financial statements (which term as used in this Agreement includes the related notes thereto) contained or incorporated by reference into the Registration Statement and Prospectuses, are independent auditors with respect to the Company and its subsidiaries as required under applicable Canadian Securities Laws and are (i) an independent registered public accounting firm as required by the Securities Act and the rules of the Public Company Accounting Oversight Board (“PCAOB”), (ii) in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X under the Securities Act and (iii) a registered public accounting firm as defined by the PCAOB whose registration has not been suspended or revoked and who has not requested such registration be withdrawn. There has not been a “reportable event” (within the meaning of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”)) between the Company and PricewaterhouseCoopers LLP.
(m) Financial Statements. The financial statements filed with the Commission and the Canadian Qualifying Authorities and which are a part of or incorporated by reference into the Registration Statement and the Prospectuses, as applicable, present fairly in all material respects the consolidated financial position of the Company and its subsidiaries as of the dates indicated and the results of their operations, changes in stockholders’ equity and cash flows for the periods specified. Such financial statements have been prepared in all material respects in compliance with the published requirements of the Securities Act, the Exchange Act and Canadian Securities Laws, as applicable, and in conformity with generally accepted accounting principles as applied in the United States (“GAAP”) applied on a consistent basis throughout the periods involved, except as may be expressly stated in the related notes thereto. The interactive data in eXtensible Business
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Reporting Language included or incorporated by reference into the Registration Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto. No other financial statements or supporting schedules are required to be included or incorporated by reference into the Registration Statement or the Prospectuses under Canadian Securities Laws. The financial data set forth in each of the Registration Statement and the Prospectuses fairly presents in all material respects the information set forth therein on a basis consistent with that of the financial statements contained or incorporated by reference into the Registration Statement and the Prospectuses, as applicable. All disclosures contained in the Registration Statement and the Prospectuses that constitute non-GAAP financial measures (as defined by the Rules and Regulations and the Exchange Act) comply with Regulation G under the Exchange Act and Item 10 of Regulation S-K under the Securities Act, as applicable.
(n) Company’s Accounting System. The Company and each of its subsidiaries make and keep accurate books and records and maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with U.S. GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) the interactive data in eXtensible Business Reporting Language included or incorporated by reference into the Registration Statement and the Prospectuses fairly presents the information called for in all material respects and was prepared in accordance with Canadian Securities Laws and the Commission’s rules and guidelines applicable thereto.
(o) Incorporation and Good Standing of the Company. The Company has been incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation and has the corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Prospectuses and to enter into and perform its obligations under this Agreement. The Company is qualified as a corporation to transact business and is in good standing in British Columbia, Canada and each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to be so qualified or in good standing in a jurisdiction outside of British Columbia, Canada would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change.
(p) Subsidiaries. Each of the Company’s subsidiaries set forth in Schedule B hereto (in this Agreement collectively, the “subsidiaries” and each a “subsidiary”) has been incorporated or organized, as the case may be, and is validly existing as a corporation, partnership or limited liability company, as applicable, in good standing under the laws of the jurisdiction of its incorporation or organization and has the power and authority (corporate or other) to own, lease and operate its properties and assets and to conduct its business as described in the Registration Statement and the Prospectuses. Each of the Company’s subsidiaries is qualified as a corporation, partnership or limited liability company, as applicable, to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to be so qualified or in good
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standing would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change. Other than pursuant to shareholder, joint venture or similar agreements disclosed in the Registration Statement and the Prospectuses, all of the issued and outstanding capital stock or other equity or ownership interests of each of the Company’s subsidiaries have been authorized and validly issued, are fully paid and non-assessable and are owned by the Company, directly or through its subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance or adverse claim. None of the outstanding capital stock or equity interest in any subsidiary was issued in violation of pre-emptive or similar rights of any security holder of such subsidiary. The constitutive or organizational documents of each of the subsidiaries comply in all material respects with the requirements of applicable laws of its jurisdiction of incorporation or organization and are in full force and effect. The Company does not own or control, directly or indirectly, any corporation, association, or other entity that would constitute a significant subsidiary as defined under Rule 1-02 of Regulation S-X other than the subsidiaries listed in Exhibit 21.1 to the Company’s most recently filed Annual Report on Form 10-K.
(q) Capitalization and Other Share Capital Matters. The authorized, issued and outstanding share capital of the Company is as set forth in the Registration Statement and the Prospectuses, subject to Common Shares and other securities of the Company issuable (i) pursuant to this Agreement, (ii) pursuant to employee benefit plans and other security-based compensation arrangements described in the Registration Statement and the Prospectuses, (iii) pursuant to the exercise of outstanding options, warrants or other convertible or exchangeable securities described in the Registration Statement and the Prospectuses, and (iv) pursuant to existing contractual rights and arrangements described in the Registration Statement and the Prospectuses. The Common Shares of the Company (including the Shares) conform in all material respects to the description thereof contained in the Prospectuses. All of the issued and outstanding Common Shares have been authorized and validly issued, are fully paid and non-assessable and have been issued in compliance with the Business Corporations Act (British Columbia). None of the outstanding Common Shares were issued in violation of any pre-emptive rights, rights of first refusal or other similar rights to subscribe for or purchase securities of the Company. There are no authorized or outstanding options, warrants, pre-emptive rights, rights of first refusal or other rights to purchase, or equity or debt securities convertible into or exchangeable or exercisable for, any shares of the Company or any of its subsidiaries other than those described in the Registration Statement and the Prospectuses. The description of the Company’s equity incentive plan and other security-based compensation arrangements, and the options or other rights granted thereunder, set forth in the Registration Statement and the Prospectuses fairly presents in all material respects the information required to be shown, pursuant to applicable securities laws, with respect to such plans, arrangements, options and rights.
(r) Stock Exchange Listing. The Common Shares are registered pursuant to Section 12(b) of the Exchange Act and are listed on the NYSE and the TSX and the Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Common Shares under the Exchange Act or delisting the Common Shares from the NYSE or the TSX, nor has the Company received any notification that the Commission, the NYSE or the TSX is contemplating terminating such registration or listing. To the Company’s knowledge, it is in compliance with all applicable listing requirements of the NYSE and the TSX.
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(s) Non-Contravention of Existing Instruments; No Further Authorizations or Approvals Required. Neither the Company nor any of its subsidiaries is in violation of its charter, articles or by-laws, partnership agreement or operating agreement or similar organizational documents, as applicable, or is in default (or, with the giving of notice or lapse of time, would be in default) (“Default”) under any indenture, loan, credit agreement, note, lease, license agreement, contract, franchise or other instrument (including, without limitation, any pledge agreement, security agreement, mortgage or other instrument or agreement evidencing, guaranteeing, securing or relating to indebtedness) to which the Company or any of its subsidiaries is a party or by which it or any of them may be bound, or to which any of their respective properties or assets are subject (each, an “Existing Instrument”), except for such Defaults as would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change. The Company’s execution, delivery and performance of this Agreement, consummation of the transactions contemplated hereby and by the Registration Statement and the Prospectuses and the issuance and sale of the Shares (including the use of proceeds from the sale of the Shares as described in the Registration Statement and the Prospectuses under the caption “Use of Proceeds”) (i) have been authorized by all necessary corporate action and will not result in any violation of the provisions of the charter, articles or by-laws, partnership agreement or operating agreement or similar organizational documents, as applicable, of the Company or any subsidiary, (ii) will not conflict with or constitute a breach of, or Default or a Debt Repayment Triggering Event (defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to, or require the consent of any other party to, any Existing Instrument except as would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change, and (iii) will not result in any violation of any law, administrative regulation or administrative or court decree applicable to the Company or any of its subsidiaries that would reasonably be expected to result in a Material Adverse Change. No consent, approval, authorization or other order of, or registration or filing with, any court or other governmental or regulatory authority or agency, is required for the Company’s execution, delivery and performance of this Agreement and consummation of the transactions contemplated hereby and by the Registration Statement and the Prospectuses, except for (i) the registration of the Shares under the Securities Act, (ii) such as have been obtained or made by the Company and are in full force and effect under the Securities Act and Canadian Securities Laws or with the NYSE or TSX, as applicable and (iii) such as may be required under applicable state securities or blue sky laws or FINRA (as hereinafter defined) . As used herein, a “Debt Repayment Triggering Event” means any event or condition which gives, or with the giving of notice or lapse of time would give, the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries.
(t) No Material Actions or Proceedings. Except as otherwise disclosed in the Registration Statement and the Prospectuses, there is no action, suit, proceeding, inquiry or investigation brought by or before any legal or governmental or regulatory authority now pending or, to the knowledge of the Company, threatened, against or affecting the Company or any of its subsidiaries, which would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change. No material labor dispute with the employees of the Company or any of its subsidiaries, or with the employees of any principal supplier, manufacturer, customer or contractor of the Company, exists or, to the knowledge of the Company, is threatened or imminent.
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(u) Intellectual Property Rights.
| i. | Each of the Company and the subsidiaries owns or possesses the right to use (i) all patents, patent applications, patent disclosures, and inventions and all improvements thereto (whether or not patentable or reduced to practice), continuations, divisionals, continuations-in-part, revisions, provisionals and patents issuing on any of the foregoing, and any renewals, reexaminations, substitutions, extensions, reissues and counterparts of any of the foregoing, together with all prosecution files, utility models and invention disclosures, (ii) all trademarks, service marks, product and service names, brands, trade dress, logos, trade names, designs, business symbols, corporate names, and other indicia of source or business identifiers, whether registered or unregistered, (including all rights to sue in passing off), and all applications, registrations and renewals and extensions of or in connection therewith and common law trademarks and service marks, together with all of the goodwill associated with any of the foregoing, (iii) all copyrights, moral rights, topography rights, rights in databases and design rights, and all applications, registrations, renewals and reversions of or in connection therewith, and all works of authorship (published and unpublished), including rights in software, (iv) domain names, domain name registrations, websites, website content, and social media identifiers, names and tags (including accounts therefor and registrations thereof), (v) all trade secrets, proprietary information, data, know-how and other confidential business or technical information (including research and development, compositions, industrial designs, industrial property, manufacturing and production processes, technical data, designs, specifications and business and marketing plans and proposals), (vi) publicity and privacy rights, (vii) all other forms of rights in technology (whether or not embodied in any tangible form) and including all tangible embodiments of the foregoing, and (viii) all other intellectual property, proprietary and other rights and forms of protection of a similar nature or having equivalent or similar effect to any of these anywhere in the world, (collectively, “Intellectual Property”) necessary to permit the Company and the subsidiaries to conduct their business as currently conducted and planned to be conducted. Neither the Company nor any of the subsidiaries has received any notice nor does or has the business of the Company or any of the subsidiaries infringed or conflicted with rights of others with respect to any Intellectual Property, and neither the Company nor any of the subsidiaries have knowledge of any facts or circumstances that would render any Intellectual Property owned by the Company and its subsidiaries invalid or inadequate to protect the interests of the Company or the subsidiaries therein; |
| ii. | the Company and its subsidiaries take and have taken commercially reasonable steps to protect and maintain the Intellectual Property owned by the Company and its subsidiaries and the confidentiality of trade secrets and material confidential information included therein, and none of the Company or its subsidiaries have disclosed any such confidential Intellectual Property to any third party other than pursuant to a written confidentiality agreement (and other than to legal counsel who are bound by professional obligations of confidentiality), pursuant to which such third party agrees to protect such confidential information; |
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| iii. | all persons who have contributed, developed or conceived any Intellectual Property owned by the Company and its subsidiaries have done so pursuant to a valid and enforceable agreement or other legal obligation that protects the confidential information of the Company and its subsidiaries and grants the Company and its subsidiaries exclusive ownership of the person’s contribution, development or conception. |
(v) All Necessary Permits, etc. Except as otherwise disclosed in the Registration Statement and the Prospectuses, the Company and each subsidiary possess such valid and current material permits, certificates and authorizations required by state, provincial, federal or foreign regulatory agencies or bodies to conduct their respective businesses as currently conducted and as described in the Registration Statement and the Prospectuses (“Permits”). Except as otherwise disclosed in the Registration Statement and the Prospectuses, the Company and its subsidiaries are not in violation of, or in material default under, any of the Permits and the Company and its subsidiaries have not received any written or, to its and their knowledge, oral notice from any governmental or regulatory authority (i) indicating or alleging that the Company or its subsidiaries do not possess any material Permit required to own, lease, and operate its properties and assets or to conduct the business as currently conducted or (ii) threatening or seeking to withdraw, revoke, terminate, or suspend any of its or their material Permits. None of the Company nor its subsidiaries’ Permits will be subject to withdrawal, revocation, termination, or suspension as a result of the execution and delivery of this Agreement or the consummation of the transactions contemplated by this Agreement.
(w) Title to Properties. Except as otherwise disclosed in the Registration Statement and the Prospectuses, the Company and its subsidiaries, taken as a whole (i) own, lease, license, control or otherwise have legal rights to, through unpatented mining claims and millsites, fee lands, mining or mineral leases, exploration and mining permits, mineral concessions or otherwise (collectively, “Mining Rights”), all of the rights, titles and interests materially necessary or appropriate to authorize and enable the appropriate subsidiary to access and carry on the material mineral exploration and/or mining, development and commissioning activities as currently being undertaken or as planned at the Thacker Pass Project, and (ii) are not in material default of such rights, titles and interests. All work required to be performed and payments required to be made in relation to the Mining Rights in order to maintain the Company’s interest therein, if any, have been paid to date, performed and/or are in the process of being performed in accordance with the laws of the jurisdiction where such subsidiary operates, and the Company and each subsidiary has complied in all material respects with all applicable governmental laws, regulations and policies in this connection as well as with regard to legal, contractual obligations to third parties (including third party contracts) in connection therewith except in respect of non-material Mining Rights that the Company or any of its subsidiaries intends to abandon or relinquish. All such Mining Rights are in good standing in all material respects.
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(x) Exploration and Development. All exploration and development operations on the properties of the Company and its subsidiaries, including all operations and activities relating to the construction, development and commissioning of the Mineral Property, have been conducted in all material respects in accordance with good exploration, development and engineering practices and all applicable laws pertaining to workers’ compensation and health and safety and workplace laws, regulations and policies have been complied with in all material respects.
(y) Mining Rights. The Company or its subsidiaries own, lease, control or otherwise have legal rights to all material Mining Rights under valid, subsisting and enforceable title documents or other recognized and enforceable agreements or instruments, sufficient to permit the Company or its subsidiaries, as applicable, and subject to the nature and scope of the Thacker Pass Project, to access, explore for, and/or mine and develop the mineral deposits relating thereto, and, other than as disclosed in the Registration Statement and the Prospectuses, no material commission, royalty, license fee or similar payment to any person with respect to the Mining Rights is payable, except which would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change. All material Mining Rights in which the Company or its subsidiaries hold an interest or right have been validly registered and recorded in accordance, with all laws of the jurisdiction where the Company or such subsidiary operates and are valid and subsisting. The Company and its subsidiaries have or expect to obtain in the ordinary course all necessary surface rights, access rights and other necessary rights and interests relating to the Mining Rights granting the Company or its subsidiaries the right and ability to access, explore for, mine and develop the mineral deposits as are appropriate in view of the rights and interests therein of the Company or its subsidiaries, with only such exceptions as do not unreasonably interfere with the use made by the Company or its subsidiaries of the rights or interest so held; and each of the documents, agreements and instruments and obligations relating thereto referred to above is currently in good standing in the name of the Company or its subsidiaries, as applicable, except where the failure to be in good standing would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change.
(z) Mineral Property Disclosure. The disclosure of the Mineral Property and Mining Rights of the Company and its subsidiaries in the Prospectuses constitutes an accurate description in all material respects of the Mineral Property and all material Mining Rights held by the Company and its subsidiaries, no other property or assets are necessary for the conduct of the business of the Company and its subsidiaries as currently conducted, and the Company does not know of any claim or the basis for any claim, including a claim with respect to aboriginal or native rights, that would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change on the right thereof to use, transfer or otherwise explore for, develop and mine mineral deposits with respect to such Mining Rights.
(aa) Technical Reports. All technical information set forth in the Registration Statement and the Prospectuses and the Free Writing Prospectuses, if any, has been reviewed by the Company or independent consultants to the Company and all such information has, to the extent required, been prepared in accordance with National Instrument 43-101 — Standards of Disclosure for Mineral Projects (“NI 43-101”) by or under the supervision of a qualified person as defined therein and, in the case of the Registration Statement, the U.S. Preliminary Prospectus and the U.S. Prospectus, in accordance with Items 1300 — 1305 of Regulation S-K under the U.S. Exchange Act (“S-K 1300”). The methods used in estimating the Company’s mineral resources and reserves are in accordance with accepted mineral resource and reserve estimation practices and the assumptions underlying such resource and reserve estimates are reasonable and appropriate. The Company has duly filed with the Canadian Qualifying Authorities or the SEC, as the case may be,
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all technical reports required by NI 43-101 or S-K 1300, as applicable, and all such reports complied at the time thereof in all material respects with the requirements thereof. To the knowledge of the Company, there have been no material changes to such technical information since the date of delivery or preparation thereof, except as disclosed or included in the Registration Statement and the Prospectuses.
(bb) Tax Law Compliance. The Company and its subsidiaries have filed all necessary federal, provincial, state and foreign income and franchise tax returns or have properly requested extensions thereof and have paid all taxes required to be paid by any of them and, if due and payable, any related or similar assessment, fine or penalty levied against any of them except as may be being contested in good faith and by appropriate proceedings (except in any case in which the failure to do so would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change). The Company has made adequate charges, accruals and reserves in the applicable financial statements referred to in Section 2(m) above in respect of all material federal, provincial, state and foreign income taxes for all periods as to which the tax liability of the Company or any of its subsidiaries has not been finally determined.
(cc) Company Not an “Investment Company.” The Company is not, and will not be, either after receipt of payment for the Shares or after the application of the proceeds therefrom as described under “Use of Proceeds” in the Registration Statement or the Prospectuses, required to register as an “investment company” under the Investment Company Act of 1940, as amended (the “Investment Company Act”).
(dd) Insurance. Each of the Company and its subsidiaries are insured by recognized and reputable institutions with policies in such amounts and with such deductibles and covering such risks as are generally deemed adequate and customary for their businesses including, but not limited to, policies covering real and personal property owned or leased by the Company and its subsidiaries against theft, damage, destruction, acts of vandalism and earthquakes. The Company has no reason to believe that it or any of its subsidiaries will not be able (i) to renew its existing insurance coverage as and when such policies expire, or (ii) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change. Neither the Company nor any of its subsidiaries has been denied any insurance coverage which it has sought or for which it has applied.
(ee) No Price Stabilization or Manipulation; Compliance with Regulation M. Neither the Company nor any of its subsidiaries has taken, directly or indirectly, any action designed to or that might reasonably be expected to cause or result in stabilization or manipulation of the price of the Common Shares or of any “reference security” (as defined in Rule 100 of Regulation M under the Exchange Act (“Regulation M”)) with respect to the Common Shares, whether to facilitate the sale or resale of the Shares or otherwise, and has taken no action which would directly or indirectly violate Regulation M.
(ff) Margin Rules. Neither the issuance, sale and delivery of the Shares nor the application of the proceeds thereof by the Company as described in each of the Registration Statement and the Prospectuses will violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.
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(gg) Related Party Transactions. All business relationships and related-party transactions involving the Company or any of its subsidiaries or any other person required to be described in the Registration Statement or the Prospectuses have been described as required in all material respects.
(hh) FINRA Matters. All of the information provided to the Agents or to counsel for the Agents by or on behalf of the Company in connection with the offering of the Shares is true, complete, correct and compliant with Financial Industry Regulatory Authority, Inc.’s (“FINRA”) rules and any letters, filings or other supplemental information provided to FINRA pursuant to FINRA Rules is true, complete and correct.
(ii) No Unlawful Contributions or Other Payments. Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any employee or agent of the Company or any subsidiary, has made any contribution or other payment to any official of, or candidate for, any federal, state or foreign office in violation of any law or of the character required to be disclosed in the Registration Statement and the Prospectuses.
(jj) Compliance with Environmental Laws. (i) The Company and each subsidiary, their respective properties and assets, and the business, affairs and operations of each of the Company and the subsidiaries, have been in compliance in all material respects with all Environmental Laws and Environmental Permits; (ii) neither the Company nor the subsidiaries are in material violation of any regulation relating to the Release or Threatened Release of Hazardous Materials; (iii) each of the Company and the subsidiaries has complied in all material respects with all reporting and monitoring requirements under all Environmental Laws and Environmental Permits; and (iv) to the knowledge of the Company, there are no events or circumstances that might reasonably be expected to form the basis of an order for clean up or remediation, or a claim by any private party or governmental or regulatory authority, against or affecting the Company or the subsidiaries relating to Hazardous Materials or any Environmental Laws; and (v) there are no Environmental Permits which either the Company or the subsidiaries do not have which are necessary to conduct the business, affairs and operations of each of the Company and the subsidiaries, as presently conducted or as planned, except for such Environmental Permits which if not obtained would not have a Material Adverse Change. Except as disclosed in the Registration Statement and the Prospectuses, the Company and each subsidiary has, collectively, obtained or possess all material Permits required by applicable law and/or expects to receive all renewals for material Permits, including all material Environmental Permits to own, lease, and operate its properties and assets and to conduct the business as currently conducted or proposed to be conducted by the Company and the subsidiaries, including access to and the construction, commissioning and operation of the Thacker Pass Project. Each material Environmental Permit, is valid, subsisting and in good standing and neither the Company nor any such subsidiary is in default or breach of any material Environmental Permit, and, except as otherwise disclosed in the Registration Statement and the Prospectuses, no proceeding is pending or, to the knowledge of the Company, threatened to revoke or limit any material Environmental Permit. No approval, consent or authorization of any aboriginal or native group is pending for the operation of the businesses carried on or proposed to be commenced by the Company or any of its subsidiaries, including access to and the construction, commissioning and operation of the Thacker Pass Project. Neither the Company nor any of its subsidiaries has used, except in material compliance with all Environmental Laws and Environmental Permits, any property or facility which it owns or leases or previously owned or
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leased, to generate, manufacture, process, distribute, use, treat, store, dispose of, transport or handle any Hazardous Materials. Neither the Company nor any of its subsidiaries, including if applicable, any predecessor companies, have received any notice of, or been prosecuted for an offence alleging, material non-compliance with any Environmental Law, and neither the Company nor any of its subsidiaries, including if applicable, any predecessor companies, have settled any allegation of material non-compliance short of prosecution. There are no orders or directions relating to environmental matters requiring any material work, repairs, construction or capital expenditures to be made with respect to any of the assets of the Company or any subsidiary, nor has the Company or any subsidiary received notice of any of the same. Except as ordinarily or customarily required by applicable Environmental Permits, neither the Company nor any of its subsidiaries has received any notice or claim wherein it is alleged or stated that it is potentially responsible in a material amount for a federal, provincial, state, municipal or local clean-up site or corrective action under any Environmental Laws. There are no environmental audits, evaluations, assessments, studies or tests relating to the Company or any of its subsidiaries except for ongoing assessments conducted by or on behalf of the Company in the ordinary course.
(kk) Periodic Review of Costs of Environmental Compliance. In the ordinary course of its business, the Company conducts a periodic review of the effect of Environmental Laws on the business, operations and properties of the Company and its subsidiaries, in the course of which it identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any Environmental Permit, any related constraints on operating activities and any potential liabilities to third parties). No facts or circumstances have come to the Company’s attention that could result in costs or liabilities that would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change.
(ll) ERISA Compliance; Employee Plans. Neither the Company nor any of its subsidiaries sponsors or maintains or has any obligation to make contributions to any “pension plan” (as defined in Section 3(2) of ERISA) subject to the standards of Section 302 of the United States Employee Retirement Income Security Act of 1974, as amended (“ERISA”). Each material plan for bonus, stock purchase, profit sharing, stock option, deferred compensation, severance or termination pay, insurance, medical, hospital, dental, vision care, drug, sick leave, disability, salary continuation, legal benefits, unemployment benefits, vacation, incentive or otherwise contributed to, or required to be contributed to, by the Company or its subsidiaries for the benefit of any current or former director, officer or employee of the Company or its subsidiaries, as applicable (the “Employee Plans”), has been maintained in all material respects in accordance with its terms and with the requirements prescribed by any and all applicable laws in respect of such Employee Plans.
(mm) Brokers. Except as otherwise disclosed in the Registration Statement and the Prospectuses, there is no broker, finder or other party that is entitled to receive from the Company any brokerage or finder’s fee or other fee or commission as a result of any transactions contemplated by this Agreement.
(nn) No Outstanding Loans or Other Extensions of Credit with Directors or Executive Officers. The Company does not have any outstanding extension of credit, in the form of a personal loan, to or for any director or executive officer of the Company except for such extensions of credit as are expressly permitted by Section 13(k) of the Exchange Act.
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(oo) Compliance with Laws. The Company and its subsidiaries have been and are in compliance with all applicable laws, rules and regulations, except where failure to be so in compliance would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change.
(pp) Dividend Restrictions. Except as disclosed in the Registration Statement and the Prospectuses, no subsidiary of the Company is prohibited or restricted, directly or indirectly, from paying dividends to the Company, or from making any other distribution with respect to such subsidiary’s equity securities or from repaying to the Company or any other subsidiary of the Company any amounts that may from time to time become due under any loans or advances to such subsidiary from the Company or from transferring any property or assets to the Company or to any other subsidiary.
(qq) Anti-Corruption and Anti-Bribery Laws. Neither the Company nor any of its subsidiaries nor any director, officer, or employee of the Company or any of its subsidiaries, nor to the knowledge of the Company, any agent, affiliate or other person acting on behalf of the Company or any of its subsidiaries has, in the course of its actions for, or on behalf of, the Company or any of its subsidiaries (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made or taken any act in furtherance of an offer, promise, or authorization of any direct or indirect unlawful payment or benefit to any foreign or domestic government official or employee, including of any government-owned or controlled entity or public international organization, or any political party, party official, or candidate for political office; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended (the “FCPA”), the Corruption of Foreign Public Officials Act (Canada) (the “CFPOA”), the UK Bribery Act 2010, or any other applicable anti-bribery or anti-corruption law; or (iv) made, offered, authorized, requested, or taken an act in furtherance of any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment or benefit. The Company and its subsidiaries and, to the knowledge of the Company, the Company’s affiliates have conducted their respective businesses in compliance with the FCPA and CFPOA and have instituted, maintain and enforce, and will continue to maintain and enforce (or are in the process of instituting and maintaining) policies and procedures designed to promote and ensure compliance with all applicable anti-bribery and anti-corruption laws.
(rr) Money Laundering Laws. The operations of the Company and its subsidiaries are, and have been conducted at all times, in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar applicable rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
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(ss) Sanctions. Neither the Company nor any of its subsidiaries, directors, officers, or employees, nor, to the knowledge of the Company, after reasonable inquiry, any agent, affiliate or other person acting on behalf of the Company or any of its subsidiaries is currently the subject or the target of any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”) or the U.S. Department of State, the United Nations Security Council, the European Union, His Majesty’s Treasury of the United Kingdom, or other relevant sanctions authority (collectively, “Sanctions”); nor is the Company or any of its subsidiaries located, organized or resident in a country or territory that is the subject or the target of Sanctions, including, without limitation, Crimea, Crimea Region and the non-government controlled areas of the Zaporizhzhia and Kherson Regions of Ukraine, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, Cuba, Iran, North Korea and Syria; and the Company will not directly or indirectly use the proceeds of this offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, or any joint venture partner or other person or entity, for the purpose of financing the activities of or business with any person, or in any country or territory, that at the time of such financing, is the subject or the target of Sanctions or in any other manner that will result in a violation by any person (including any person participating in the transaction whether as underwriter, advisor, investor or otherwise) of applicable Sanctions. Since April 24, 2019, the Company and its subsidiaries have not knowingly engaged in and are not now knowingly engaged in any dealings or transactions with any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with any sanctioned country.
(tt) Outbound Investment Security Program. Neither the Company nor any of its subsidiaries is a “covered foreign person”, as that term is defined in 31 C.F.R. § 850.209. Neither the Company nor any of its subsidiaries or joint ventures currently engages, or has plans to engage, directly or indirectly, in a “covered activity”, as that term is defined in 31 C.F.R. § 850.208 (a “Covered Activity”). The Company does not, directly or indirectly, derive more than 50% of its revenue or its net income or incur more than 50% of its capital expenditures or its operating expenses from one or more persons that engage or, to the knowledge of the Company, plan to engage in any Covered Activity.
(uu) Sarbanes-Oxley. The Company is in compliance, in all material respects, with all applicable provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated thereunder.
(vv) Duties, Transfer Taxes, Etc. No stamp or other issuance or transfer taxes or duties are payable by the Agents to the United States, Canada or any political subdivision or taxing authority thereof or therein in connection with the execution, delivery or performance of this Agreement by the Company or the sale and delivery by the Company of the Shares.
(ww) Withholding Taxes. No withholding tax imposed under the federal laws of Canada or the laws of the Provinces of Ontario, British Columbia and Alberta will be payable in respect of any commission or fee to be paid by the Company pursuant to this Agreement to the Agents that are “non-residents” within the meaning of the Income Tax Act (Canada) provided any such commission or fee is payable in respect of services rendered by such Agents wholly outside of Canada and are performed in the ordinary course of business carried on by the Agents that includes the performance of such services for a fee and any such amount is reasonable in the circumstances.
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(xx) Canadian Reporting Issuer. The Company is a reporting issuer (or the equivalent thereof) in each Canadian Qualifying Jurisdiction and is not noted in default on the list of reporting issuers maintained by the applicable authorities in each Canadian Qualifying Jurisdiction that maintains such a list. The Company has not filed any confidential material change reports which remain confidential at the date hereof.
(yy) Cybersecurity. (i) (x) There has been no material security breach or other material compromise of or relating to any of the Company’s or any of its subsidiaries’ information technology and computer systems, networks, hardware, software, data (including the data of their respective customers, employees, suppliers, vendors and any third party data maintained by or on behalf of them), equipment or technology (collectively, “IT Systems and Data”) and (y) the Company and its subsidiaries have not been notified of, and have no knowledge of any event or condition that would reasonably be expected to result in, any material security breach or other material compromise to their IT Systems and Data; (ii) the Company and its subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as would not, in the cause of clause (ii), reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change; and (iii) the Company and its subsidiaries have implemented backup and disaster recovery technology consistent with industry standards and practices.
(zz) Compliance with Data Privacy Laws. The Company and its subsidiaries are, and at all prior times were, in material compliance with all applicable state and federal data privacy and security laws and regulations, including without limitation The Health Insurance Portability and Accountability Act of 1996, and the Company and its subsidiaries have taken commercially reasonable actions to prepare to comply with, and since May 25, 2018 or since the date of incorporation or formation, as applicable, have been and currently are in material compliance with, the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679), to the extent the GDPR applies to the Company (collectively, the “Privacy Laws”). To ensure compliance with the Privacy Laws, the Company and its subsidiaries have in place, comply with, and take appropriate steps reasonably designed to ensure compliance in all material respects with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling, and analysis of Personal Data (the “Policies”). The Company and its subsidiaries have at all times made all material disclosures to users or customers required by applicable laws and regulatory rules or requirements, and none of such disclosures made or contained in any Policy have, to the knowledge of the Company, been inaccurate or in violation of any applicable laws and regulatory rules or requirements in any material respect. The Company further certifies that neither it nor any subsidiary: (i) has received notice of any actual or potential liability under or relating to, or actual or potential violation of, any of the Privacy Laws, and has no knowledge of any event or condition that would reasonably be expected to result in any such notice; (ii) is currently conducting or paying for, in whole or in part, any investigation, remediation, or other corrective action pursuant to any Privacy Law; or (iii) is a party to any order, decree, or agreement that imposes any obligation or liability under any Privacy Law, except with respect to subsection (i), (ii) and (iii) as would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change.
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(aaa) Forward-Looking Statements. The Company has a reasonable basis for disclosing any forward-looking statement (within the meaning of Section 27A of the U.S. Securities Act and Section 21E of the Exchange Act) and any forward-looking information (within the meaning of Canadian Securities Laws) included or incorporated by reference in any of the Registration Statement or the Prospectuses and is not, as of the date hereof, required to update any such forward-looking information pursuant to NI 51-102, and such forward looking information included or incorporated by reference in any of the Registration Statement or the Prospectuses reflects the best currently available estimates and good faith judgments of the management of the Company, as the case may be, as to the matters covered thereby.
(bbb) No Ratings. There are no debt securities, convertible securities or preferred stock issued or guaranteed by the Company or any of its subsidiaries that are rated by a “nationally recognized statistical rating organization”, as such term is defined in Section 3(a)(62) under the Exchange Act.
(ccc) No Immunity. Neither the Company nor any of its subsidiaries or their properties or assets has immunity under Canadian, U.S. federal or New York state law from any legal action, suit or proceeding, from the giving of any relief in any such legal action, suit or proceeding, from set-off or counterclaim, from the jurisdiction of any Canadian, U.S. federal or New York state court, from service of process, attachment upon or prior to judgment, or attachment in aid of execution of judgment, or from execution of a judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of a judgment, in any such court with respect to their respective obligations, liabilities or any other matter under or arising out of or in connection herewith; and, to the extent that the Company or any of its subsidiaries or any of its properties, assets or revenues may have or may hereafter become entitled to any such right of immunity in any such court in which proceedings arising out of, or relating to the transactions contemplated by this Agreement, may at any time be commenced, the Company has waived, and it will waive, or will cause its subsidiaries to waive, such right to the extent permitted by law.
(ddd) Enforcement of Foreign Judgments. Any final judgment for a fixed or determined sum of money rendered by any U.S. federal or New York state court located in the State of New York having jurisdiction under its own laws in respect of any suit, action or proceeding against the Company based upon this Agreement would be declared enforceable against the Company by the courts of Canada, without reconsideration or reexamination of the merits (subject to customary exceptions including with respect to public policy, fraud, lack of natural justice, penal awards, and foreign judgements that conflict with Canadian judgments).
(eee) Valid Choice of Law. The choice of laws of the State of New York as the governing law of this Agreement is a valid choice of law under the laws of Canada and will be honored by the courts of Canada, subject to the restrictions described under the caption “Enforceability of Certain Civil Liabilities” in the Registration Statement and the Prospectuses. The Company has the power to submit, and has legally, validly, effectively and irrevocably submitted, to the personal jurisdiction of each New York state and United States federal court sitting in the City of New York and has validly and irrevocably waived any objection to the laying of venue of any suit, action or proceeding brought in such court.
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(fff) Legality. The legality, validity, enforceability or admissibility into evidence of any of the Registration Statement and the Prospectuses, this Agreement or the Shares in any jurisdiction in which the Company is organized or does business is not dependent upon such document being submitted into, filed or recorded with any court or other authority in any such jurisdiction on or before the date hereof or that any tax, imposition or charge be paid in any such jurisdiction on or in respect of any such document.
(ggg) Legal Action. A holder of the Shares and each Agent are each entitled to sue as plaintiff in the court of the jurisdiction of formation and domicile of the Company for the enforcement of their respective rights under this Agreement and the Shares and such access to such courts will not be subject to any conditions which are not applicable to residents of such jurisdiction or a company incorporated in such jurisdiction except that plaintiffs not residing in Canada may be required to guarantee payment of a possible order for payment of costs or damages at the request of the defendant.
(hhh) Other Underwriting Agreements. The Company is not a party to any agreement with an agent or underwriter for any other “at the market” or continuous equity transaction.
Any certificate signed by any officer or other authorized representative of the Company or any of its subsidiaries and addressed and delivered to the Agents in connection with an issuance of Shares shall be deemed a representation and warranty by the Company to the Agents as to the matters covered thereby on the date of such certificate.
The Company acknowledges that the Agents and, for purposes of the opinions to be delivered pursuant to Section 4(p) hereof, counsel to the Company and counsel to the Agents, will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents to such reliance.
Section 3. ISSUANCE AND SALE OF COMMON SHARES
(a) Sale of Securities. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company and the Agents agree that the Company may from time to time seek to sell Shares through any of the Agents, acting as sales agent, or directly to any of the Agents, acting as principals, as follows, with an aggregate Sales Price of up to the Maximum Program Amount, based on and in accordance with Issuance Notices as the Company may deliver, during the Agency Period. The Company acknowledges and agrees that sales of Shares under this Agreement may be made through Affiliates of the Agents and that the Agents may otherwise fulfill their obligations pursuant to this Agreement to or through an affiliated broker-dealer and that the Agents may determine the remuneration payable by the Agents to such Affiliates or affiliated broker-dealer, provided that such remuneration shall not in any way increase the Selling Commission payable by the Company under this Agreement.
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(b) Mechanics of Issuances.
(i) Issuance Notice. Upon the terms and subject to the conditions set forth herein, on any Trading Day during the Agency Period on which the conditions set forth in Section 5(a) and Section 5(b) shall have been satisfied, the Company may exercise its right to request an issuance of Shares by delivering to the applicable Agent an Issuance Notice; provided, however, that (A) in no event may the Company deliver an Issuance Notice to the extent that (I) the sum of (x) the aggregate Sales Price of the requested Issuance Amount, plus (y) the aggregate Sales Price of all Shares issued under all previous Issuance Notices effected pursuant to this Agreement, would exceed the Maximum Program Amount; and (B) prior to delivery of any Issuance Notice, the period set forth for any previous Issuance Notice shall have expired or been terminated. An Issuance Notice shall be considered delivered on the Trading Day that it is received by e-mail to the persons set forth in Schedule A hereto and confirmed by the Company by telephone (including a voicemail message to the persons so identified), with the understanding that, with adequate prior written notice, the Agents may modify the list of such persons from time to time.
(ii) Agent Efforts. Upon the terms and subject to the conditions set forth in this Agreement, upon the receipt of an Issuance Notice, the receiving Agent will use its commercially reasonable efforts consistent with its normal sales and trading practices to place the Shares with respect to which the Agent has agreed to act as sales agent, subject to and in compliance with all applicable laws and subject to, and in accordance with the information specified in, the Issuance Notice, unless the sale of the Shares described therein has been suspended, cancelled or otherwise terminated in accordance with the terms of this Agreement. For the avoidance of doubt, the parties to this Agreement may modify an Issuance Notice at any time provided they both agree in writing to any such modification.
(iii) Method of Offer and Sale. The Shares may be offered and sold (A) in privately negotiated transactions with the consent of the Company; (B) as block transactions; (C) by the Canadian Agent, on the TSX or on any other “marketplace” (as such term is defined in NI 21-101 – Marketplace Operation (“NI 21-101”)) in Canada, (D) by the U.S. Agent, on the NYSE or on any other “marketplace” (as such term is defined in NI 21-101) in the United States, (E) by any other method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act, or sales made into any other existing trading market of the Common Shares, or (F) by any method permitted by law that constitutes an “at-the-market distribution” under NI 44-102. Subject to compliance by the applicable Agent with the applicable Issuance Notice, nothing in this Agreement shall be deemed to require either party to agree to the method of offer and sale specified in the preceding sentence, and (except as specified in clauses (A) and (B) above) the method of placement of any Shares by the Agents shall be at the Agents’ discretion.
(iv) Confirmation to the Company. If acting as sales agent hereunder, each applicable Agent will provide written confirmation to the Company no later than the opening of the Trading Day next following the Trading Day on which it has placed Shares hereunder setting forth the number of Shares sold on such Trading Day, the corresponding average Sales Price, the aggregate gross proceeds, the total fees payable to the Agents (the Selling Commission plus any additional fees) and the Net Issuance Price payable to the Company in respect thereof. The applicable Agent will deliver to the Company, for each fiscal quarter of the Company and fiscal year of the Company during which Shares are sold pursuant to this Agreement, and otherwise as reasonably requested by the Company to enable the Company to meet its quarterly and annual or other reporting requirements under Canadian Securities Laws or any applicable requirements of the TSX or NYSE, within three Trading Days (or such lesser number of days as agreed to by the Company and the applicable Agent) after the end of the fiscal quarter or fiscal year, a report stating the number of Shares distributed pursuant to this Agreement during such fiscal quarter or fiscal year, together with such information as specified in Section 4(a), calculated on a quarterly basis or annual basis, as applicable.
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(v) Settlement. Each issuance of Shares will be settled on the applicable Settlement Date for such issuance of Shares and, subject to the provisions of Section 5, on or before each Settlement Date, the Company will, or will cause its transfer agent to, electronically issue and transfer the Shares being sold by crediting the relevant Agent or its designee’s account at The Depository Trust Company through its Deposit/Withdrawal At Custodian (DWAC) System for Shares sold in the United States and at CDS Clearing and Depositary Services Inc. through its CDSX system for Shares sold in Canada, or by such other means of delivery as may be mutually agreed upon by the parties hereto and, upon receipt of such Shares, which in all cases shall be freely tradable, transferable, registered shares in good deliverable form, the relevant Agent will deliver, by wire transfer of immediately available funds, the related aggregate Net Issuance Price in same day funds delivered to an account designated by the Company prior to the Settlement Date. Subject to TSX approval, the Company may sell Shares to such Agent as principal at a price agreed upon at each relevant Time of Sale.
(vi) Suspension or Termination of Sales. Consistent with standard market settlement practices, the Company or the applicable Agent may, upon notice to the other party hereto in writing or by telephone (confirmed immediately by verifiable email), suspend any sale of Shares, and the period set forth in an Issuance Notice shall immediately terminate; provided, however, that (A) such suspension and termination shall not affect or impair either party’s obligations with respect to any Shares placed or sold hereunder prior to the receipt of such notice; (B) if the Company suspends or terminates any sale of Shares after the relevant Agent confirms such sale to the Company, the Company shall still be obligated to comply with Section 3(b)(v) with respect to such Shares; and (C) if the Company defaults in its obligation to deliver Shares on a Settlement Date, the Company agrees that it will hold each Agent harmless against any loss, claim, damage or expense (including, without limitation, penalties, interest and reasonable legal fees and expenses), as incurred, arising out of or in connection with such default by the Company. The parties hereto acknowledge and agree that, in performing its obligations under this Agreement, each Agent may borrow Common Shares from stock lenders in the event that the Company has not delivered Shares to settle sales as required by subsection (v) above, and may use the Shares to settle or close out such borrowings. The Company agrees that no such notice shall be effective against such Agent unless it is made to the persons identified in writing by the Agents pursuant to Section 3(b)(i).
(vii) No Guarantee of Placement, Etc. The Company acknowledges and agrees that (A) there can be no assurance that the Agents will be successful in placing Shares; (B) the Agents will incur no liability or obligation to the Company or any other Person if they do not sell Shares; and (C) the Agents shall be under no obligation to purchase Shares on a principal basis pursuant to this Agreement, except as otherwise specifically agreed by the Agents and the Company.
(viii) Material Non-Public Information. Notwithstanding any other provision of this Agreement, the Company and the Agents agree that the Company shall not deliver any Issuance Notice to the Agents, and the Agents shall not be obligated to place any Shares, (i) during any period in which the Company is in possession of material non-public information, or (ii) at any
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time from and including the date on which the Company shall issue a press release containing, or shall otherwise publicly announce, its earnings, revenues or other results of operations (an “Earnings Announcement”) through and including the time that the Company files a Quarterly Report on Form 10-Q or an Annual Report on Form 10-K that includes consolidated financial statements as of and for the same period or periods, as the case may be, covered by such Earnings Announcement.
(c) Fees. As compensation for services rendered, the Company shall pay to the relevant Agent, on the applicable Settlement Date, the Selling Commission for the applicable Issuance Amount (including with respect to any suspended or terminated sale pursuant to Section 3(b)(vi)) by such Agent deducting the Selling Commission from the applicable Issuance Amount and such Selling Commission shall be distributed among the Agents as agreed to by the parties.
(d) Expenses. The Company agrees to pay all costs, fees and expenses incurred in connection with the performance of its obligations hereunder and in connection with the transactions contemplated hereby, including without limitation (i) all expenses incident to the issuance and delivery of the Shares (including all printing and engraving costs); (ii) all fees and expenses of the registrar and transfer agent of the Shares; (iii) all necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the Shares; (iv) all fees and expenses of the Company’s counsel, independent public or certified public accountants and other advisors; (v) all costs and expenses incurred in connection with the preparation, printing, filing, shipping and distribution of the Registration Statement and the Canadian Base Prospectus (including financial statements, exhibits, schedules, consents and certificates of experts), the Prospectuses, any Free Writing Prospectus prepared by or on behalf of, used by, or referred to by the Company, and all amendments and supplements thereto, and this Agreement; (vi) all filing fees, attorneys’ fees and expenses incurred by the Company or the Agents in connection with qualifying or registering (or obtaining exemptions from the qualification or registration of) all or any part of the Shares for offer and sale under the state securities or blue sky laws or the provincial securities laws of Canada, and, if requested by the Agents, preparing and printing a “Blue Sky Survey” or memorandum, and any supplements thereto, advising the Agents of such qualifications, registrations, determinations and exemptions; (vii) the reasonable fees and disbursements of the Agent’s US and Canadian counsel, including the reasonable fees and expenses of counsel for the Agent in connection with, FINRA review, if any, and approval of the Agent’s participation in the offering and distribution of the Shares; (viii) the filing fees incident to FINRA review, if any; and (ix) the fees and expenses associated with listing the Shares on the TSX and the NYSE. The fees and disbursements of the Agents’ U.S. counsel to be paid by the Company in accordance with this Section 3(d) shall not exceed (A) US$75,000 in connection with the first Issuance Notice and (B) US$15,000 in connection with each Triggering Event Date (as hereinafter defined) on which the Company is required to provide a certificate pursuant to Section 4(o). The fees and disbursements of the Agents’ Canadian counsel shall not exceed (A) US$65,000 in connection with the first Issuance Notice and (B) US$10,000 in connection with each Triggering Event Date on which the Company is required to provide a certificate pursuant to Section 4(o). Notwithstanding the forgoing, all fees paid to, and expense reimbursement of, the Agents in connection with the offering of the Shares pursuant to this Agreement, including the Selling Commission, will not in the aggregate exceed 8% of the total Issuance Amount.
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Section 4. ADDITIONAL COVENANTS
The Company covenants and agrees with the Agents as follows, in addition to any other covenants and agreements made elsewhere in this Agreement:
(a) Exchange Act Compliance; Canadian Securities Laws Compliance. During the Agency Period, the Company shall file, on a timely basis, with the Commission all reports and documents required to be filed under Section 13, 14 or 15 of the Exchange Act in the manner and within the time periods required by the Exchange Act and file, on a timely basis, with the Canadian Qualifying Authorities all reports and documents required to be filed pursuant to applicable Canadian Securities Laws, as appropriate; and either (i) include in its quarterly and annual management’s discussion and analysis, a summary detailing, for the relevant reporting period, (1) the number of and average price of Shares sold through the Agents pursuant to this Agreement and (2) the aggregate gross proceeds and aggregate net proceeds raised by the Company from such sales and the aggregate commissions paid or payable in respect of such sales, in each case during such relevant reporting period or (ii) prepare a prospectus supplement containing, or include in such other filing permitted by the Securities Act or Exchange Act (each an “Interim Prospectus Supplement”), such summary information and, at least once a quarter and subject to this Section 4, file such Interim Prospectus Supplement pursuant to Rule 424(b) under the Securities Act (and within the time periods required by Rule 424(b) and Rule 430B under the Securities Act).
The Company will use commercially reasonable efforts to comply with all requirements imposed upon it by the Canadian Securities Laws as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in, the Shares as contemplated by the provisions of this Agreement, the Registration Statement and the Prospectuses.
(b) Securities Act Compliance. After the date of this Agreement, the Company shall promptly advise the Agents in writing (i) of the receipt of any comments of, or requests for additional or supplemental information from, the Commission or the Canadian Qualifying Authorities; (ii) of the time and date of any filing of any post-effective amendment to the Registration Statement or any amendment or supplement to the Canadian Base Prospectus, the Prospectuses or any Free Writing Prospectus; (iii) of the time and date that any post-effective amendment to the Registration Statement becomes effective; and (iv) of the issuance by the Commission or the Canadian Qualifying Authorities of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto, or any amendment or supplement to the Canadian Base Prospectus, the Prospectuses or of any order preventing or suspending the use of any Free Writing Prospectus or the Prospectuses, or of any proceedings to remove, suspend or terminate from listing or quotation the Common Shares from any securities exchange upon which they are listed for trading or included or designated for quotation, or of the threatening or initiation of any proceedings for any of such purposes. If the Commission or the Canadian Qualifying Authorities shall enter any such stop or other order at any time, the Company will use its commercially reasonable efforts to obtain the lifting of such order as soon as reasonably practicable. Additionally, the Company agrees that it shall comply with the provisions of Rule 424(b) and Rule 433, as applicable, under the Securities Act and will use its commercially reasonable efforts to confirm that any filings made by the Company under such Rule 424(b) or Rule 433 were received in a timely manner by the Commission.
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(c) Amendments and Supplements to the Prospectus and Other Securities Act Matters. If any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectuses so that the Prospectuses do not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or so that the Prospectuses do not contain a misrepresentation as defined under Canadian Securities Laws, or if in the reasonable opinion of the Agents or counsel for the Agents it is otherwise necessary to amend or supplement the Prospectuses to comply with applicable laws, including the Securities Act or Canadian Securities Laws, the Company agrees (subject to Section 4(d) and 4(f)) that it will cause (i) each amendment or supplement to the U.S. Prospectuses to be filed with the Commission as required pursuant to Rule 424(b) or, in the case of any document to be incorporated therein by reference, to be filed with the Commission as required pursuant to the Exchange Act, within the time period prescribed and (ii) each amendment or supplement to the Canadian Prospectuses to be filed with the Canadian Qualifying Authorities as required pursuant to Canadian Shelf Procedures or, in the case of any document to be incorporated therein by reference, to be filed with the Canadian Qualifying Authorities as required pursuant to the Canadian Securities Laws, so that the statements in the Prospectuses as so amended or supplemented will not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or so that such Prospectuses do not contain a misrepresentation or so that the Prospectuses, as amended or supplemented, will comply with applicable laws, including the Securities Act and Canadian Securities Laws. Neither the Agents’ consent to, or delivery of, any such amendment or supplement shall constitute a waiver of any of the Company’s obligations under Sections 4(d) and 4(f).
(d) Agents’ Review of Proposed Amendments and Supplements. Prior to amending or supplementing the Registration Statement or the Prospectuses (excluding any amendment or supplement through incorporation of any report or document filed under the Exchange Act or pursuant to Canadian Securities Laws), insofar as such proposed amendment or supplement relates to the Shares or to the U.S. Prospectus, the Company shall furnish to the Agents for review, a reasonable amount of time prior to the proposed time of filing or use thereof, a copy of each such proposed amendment or supplement, and the Company shall not file or use any such proposed amendment or supplement without the Agents’ prior consent, with such consent not to be unreasonably withheld or delayed, and the Company shall file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.
(e) Use of Free Writing Prospectus. Neither the Company nor the Agents have prepared, used, referred to or distributed, or will prepare, use, refer to or distribute, without the other party’s prior written consent, any “written communication” that constitutes a “free writing prospectus” as such terms are defined in Rule 405 under the Securities Act with respect to the offering contemplated by this Agreement (any such free writing prospectus being referred to herein as a “Free Writing Prospectus”).
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(f) Free Writing Prospectuses. The Company shall furnish to the Agents for review, a reasonable amount of time prior to the proposed time of filing or use thereof, a copy of each proposed free writing prospectus or any amendment or supplement thereto to be prepared by or on behalf of, used by, or referred to by the Company and the Company shall not file, use or refer to any proposed free writing prospectus or any amendment or supplement thereto without the Agents’ consent, with such consent not to be unreasonably withheld. The Company shall furnish to the Agents, without charge, as many copies of any free writing prospectus prepared by or on behalf of, or used by the Company, as the Agents may reasonably request. If at any time when a prospectus is required by the Securities Act (including, without limitation, pursuant to Rule 173(d)) or Canadian Securities Laws to be delivered in connection with sales of the Shares (but in any event if at any time through and including the date of this Agreement) there occurred or occurs an event or development as a result of which any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company conflicted or would conflict with the information contained in the Registration Statement or the Prospectuses or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing at that subsequent time, not misleading, or would contain a misrepresentation as defined under Canadian Securities Laws, the Company shall promptly amend or supplement such free writing prospectus to eliminate or correct such conflict or so that the statements in such free writing prospectus as so amended or supplemented will not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing at such subsequent time, not misleading, or would not contain such a misrepresentation, as the case may be; provided, however, that prior to amending or supplementing any such free writing prospectus, the Company shall furnish to the Agents for review, a reasonable amount of time prior to the proposed time of filing or use thereof, a copy of such proposed amended or supplemented free writing prospectus and the Company shall not file, use or refer to any such amended or supplemented free writing prospectus without the Agent’s consent, with such consent not to be unreasonably withheld.
(g) Filing of Agent Free Writing Prospectuses. The Company shall not take any action that would result in the Agents or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Agent that the Agents otherwise would not have been required to file thereunder.
(h) Copies of Registration Statement and Prospectuses. After the date of this Agreement through the last time that a prospectus is required by the Securities Act (including, without limitation, pursuant to Rule 173(d)) or Canadian Securities Laws to be delivered in connection with sales of the Shares, the Company agrees to furnish the Agents with copies (which may be electronic copies) of the Registration Statement and each amendment thereto, and with copies of the Prospectuses and each amendment or supplement thereto in the form in which it is filed with the Commission pursuant to the Securities Act or with the Canadian Qualifying Authorities, as applicable, both in such quantities as the Agents may reasonably request from time to time; and, if the delivery of a prospectus is required under the Securities Act or under Canadian Securities Laws or under the blue sky or securities laws of any jurisdiction at any time on or prior to the applicable Settlement Date for any period set forth in an Issuance Notice in connection with the offering or sale of the Shares and if at such time any event has occurred as a result of which the Prospectuses as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectuses are delivered, not misleading, or would contain a misrepresentation as defined under Canadian Securities Laws, or,
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if for any other reason it is necessary during such same period to amend or supplement the Prospectuses or to file under the Exchange Act or Canadian Securities Laws any document incorporated by reference into the Prospectuses in order to comply with the Securities Act or the Exchange Act or Canadian Securities Laws, to notify the Agents and to request that the Agents suspend offers to sell Shares (and, if so notified, the Agents shall cease such offers as soon as practicable); and if the Company decides to amend or supplement the Registration Statement or the Prospectuses as then amended or supplemented, to advise the Agents promptly by telephone (with confirmation in writing) and to prepare and cause to be filed promptly with the Commission and if necessary the Canadian Qualifying Authorities, an amendment or supplement to the Registration Statement or the Prospectuses as then amended or supplemented that will correct such statement or omission or effect such compliance; provided, however, that if during such same period the Agents are required to deliver a prospectus in respect of transactions in the Shares, the Company shall promptly prepare and file with the Commission or Canadian Qualifying Authorities, as applicable, such an amendment or supplement.
(i) Blue Sky Compliance. The Company shall cooperate with the Agents and counsel for the Agents to qualify or register the Shares for sale under (or obtain exemptions from the application of) the state securities or blue sky laws of those jurisdictions designated by the Agents, shall comply with such laws and shall continue such qualifications, registrations and exemptions in effect so long as required for the distribution of the Shares. The Company shall not be required to qualify as a foreign corporation or to take any action that would subject it to general service of process in any such jurisdiction where it is not presently qualified or where it would be subject to taxation as a foreign corporation. The Company will advise the Agents promptly of the suspension of the qualification or registration of (or any such exemption relating to) the Shares for offering, sale or trading in any jurisdiction or any initiation or threat of any proceeding for any such purpose, and in the event of the issuance of any order suspending such qualification, registration or exemption, the Company shall use its commercially reasonable efforts to obtain the withdrawal thereof at the earliest possible moment.
(j) Earnings Statement. As soon as reasonably practicable, the Company will make generally available to its security holders and to the Agents an earnings statement (which need not be audited) covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 under the Securities Act.
(k) Listing; Reservation of Shares. (a) The Company will use its commercially reasonable efforts to maintain the listing of the Shares on the TSX and the NYSE; and (b) the Company will reserve and keep available at all times, free of preemptive rights (except as disclosed in the Registration Statement and the Prospectuses), Shares for the purpose of enabling the Company to satisfy its obligations under this Agreement.
(l) Transfer Agent. The Company shall engage and maintain, at its expense, a registrar and transfer agent for the Shares.
(m) Due Diligence. During the term of this Agreement, the Company will reasonably cooperate with any reasonable due diligence review conducted by the Agents in connection with the transactions contemplated hereby, including, without limitation, providing information and making available documents and senior corporate officers, during normal business hours and at the Company’s principal offices, as the Agents may reasonably request from time to time.
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(n) Representations and Warranties. The Company acknowledges that each delivery of an Issuance Notice and each delivery of Shares on a Settlement Date shall be deemed to be (i) an affirmation to the Agents that the representations and warranties of the Company contained in or made pursuant to this Agreement are true and correct as of the date of such Issuance Notice or of such Settlement Date, as the case may be, as though made at and as of each such date, except as may be disclosed in the Prospectuses (including any documents incorporated by reference therein and any supplements thereto); and (ii) an undertaking that the Company will advise the Agents if any of such representations and warranties will not be true and correct as of the Settlement Date for the Shares relating to such Issuance Notice, as though made at and as of each such date (except that such representations and warranties shall be deemed to relate to the Registration Statement and the Prospectuses as amended and supplemented relating to such Shares and as any such representation or warranty is, by its express terms, limited to a specific date).
(o) Deliverables at Triggering Event Dates; Certificates. The Company agrees that on or prior to the date of the first Issuance Notice and, during the term of this Agreement after the date of the first Issuance Notice, upon:
(A) the filing of an amendment or supplement of any Registration Statement or Prospectuses (other than a prospectus supplement relating solely to an offering of securities other than the Shares or a prospectus filed pursuant to Section 4(a)(ii), by means of a post-effective amendment, sticker or supplement, but not by means of incorporation of documents by reference into the Registration Statement or Prospectuses);
(B) the filing with the Commission of an Annual Report on Form 10-K (including any Form 10-K/A containing amended financial information or a material amendment to the previously filed Form 10-K) (an “Annual Report”); the filing with the Commission of a Quarterly Report on Form 10-Q under the Exchange Act; or the filing with the Commission of a Current Report on Form 8-K containing amended financial information (other than information “furnished” pursuant to Items 2.02 or 7.01 of Form 8-K or to provide disclosure pursuant to Item 8.01 of Form 8-K relating to the reclassification of certain properties as discontinued operations in accordance with Statement of Financial Accounting Standards No. 144) under the Exchange Act; or
(C) any other time reasonably requested by the Agents in connection with the execution of a block transaction as contemplated by Section 3(b)(iii); (any such event, a “Triggering Event Date”), the Company shall furnish the Agents with a certificate as of the Triggering Event Date, in the form and substance satisfactory to the Agents and their counsel, substantially similar to the form previously provided to the Agents and their counsel, modified, as necessary, to relate to the Registration Statement and the Prospectuses as amended or supplemented, (A) confirming that the representations and warranties of the Company contained in this Agreement are true and correct, (B) that the Company has performed all of its obligations hereunder to be performed on or prior to the date of such certificate and as to the matters set forth in Section 5(a)(iii) hereof, and (C) containing any other certification that the Agents shall reasonably request. The requirement to provide a certificate under this Section 4(o) shall be waived
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for any Triggering Event Date occurring at a time when no Issuance Notice is pending or a suspension is in effect, which waiver shall continue until the earlier to occur of the date the Company delivers instructions for the sale of Shares hereunder (which for such calendar quarter shall be considered a Triggering Event Date) and the next occurring Triggering Event Date. Notwithstanding the foregoing, if the Company subsequently decides to sell Shares following a Triggering Event Date when a suspension was in effect and did not provide the Agents with a certificate under this Section 4(o), then before the Company delivers the instructions for the sale of Shares or the Agents sell any Shares pursuant to such instructions, the Company shall provide the Agents with a certificate in conformity with this Section 4(o) dated as of the date that the instructions for the sale of Shares are issued.
(p) Legal Opinions. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to which the Company is obligated to deliver a certificate pursuant to Section 4(o) for which no waiver is applicable and excluding the date of this Agreement, the Company shall cause to be furnished to the Agents (i) a negative assurances letter and the written legal opinion of Vinson & Elkins LLP, United States counsel to the Company, (ii) a written legal opinion of Cassels Brock & Blackwell LLP, Canadian counsel to the Company and (iii) in respect of each Triggering Event Date in connection with the filing of an Annual Report, (A) a written legal opinion of Erwin Thompson Faillers, Nevada counsel to the Company, (B) a written legal opinion of Holland & Hart LLP, counsel to the Company with respect to certain entities formed in connection with the Thacker Pass Project, and (C) written legal opinions as to securities matters of local counsel in the Canadian Qualifying Jurisdictions other than the Provinces of British Columbia, Alberta and Ontario, in the cases of (i)-(iii), each dated the date of delivery, in form and substance reasonably satisfactory to Agents and their counsel, substantially similar to the form previously provided to the Agents and their counsel, modified, as necessary, to relate to the Registration Statement and the Prospectuses as then amended or supplemented. In lieu of such opinions for subsequent periodic filings, in the discretion of the Agents, the Company may furnish a reliance letter from such counsel to the Agents, permitting the Agents to rely on a previously delivered opinion letter, modified as appropriate for any passage of time or Triggering Event Date (except that statements in such prior opinion shall be deemed to relate to the Registration Statement and the Prospectuses as amended or supplemented as of such Triggering Event Date). In connection with every delivery of a negative assurance letter of Vinson & Elkins LLP pursuant to this Section 4(p), the Agents shall have received a negative assurance letter of Skadden, Arps, Slate, Meagher & Flom LLP, United States counsel to the Agents.
(q) Title Opinion. On or prior to the date of the first Issuance Notice and on or prior to (i) the filing by the Company of an Annual Report, (ii) any material change to the ownership or title of the Company to the Mining Rights in respect of the Mineral Property or (iii) the determination by the Company that any other property is material to the Company, the Company shall cause to be furnished to the Agents a written opinion of other counsel satisfactory to the Agents as to the ownership and title of the Company to the Mining Rights in respect of the Mineral Property and any such other material property; provided, however, that the Company shall not be required to deliver such opinion if during such period the Company is not obligated to deliver a certificate pursuant to Section 4(o) as a result of a waiver from such requirement.
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(r) Comfort Letter. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to which the Company is obligated to deliver a certificate pursuant to Section 4(o) for which no waiver is applicable and excluding the date of this Agreement, the Company shall cause PricewaterhouseCoopers LLP, the independent registered public accounting firm who has audited the financial statements incorporated by reference into the Registration Statement and the Prospectuses, to furnish the Agents a comfort letter, dated the date of delivery, in form and substance reasonably satisfactory to the Agents and their counsel, substantially similar to the form previously provided to the Agents and their counsel. If requested by the Agents, the Company shall also cause a comfort letter to be furnished to the Agents within ten (10) Trading Days of the date of occurrence of any material transaction or event requiring the filing of a report on Form 8-K containing material amended financial information of the Company, including the restatement of the Company’s consolidated financial statements.
(s) Secretary’s Certificate. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to which the Company is obligated to deliver a certificate pursuant to Section 4(o) for which no waiver is applicable, the Company shall furnish to the Agents a certificate executed by the Secretary of the Company, signing in such capacity, dated the date of delivery (i) certifying that attached thereto are true and complete copies of the resolutions duly adopted by the Board of Directors of the Company authorizing the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby (including, without limitation, the issuance of the Shares pursuant to this Agreement), which authorization shall be in full force and effect on and as of the date of such certificate, (ii) certifying and attesting to the office, incumbency, due authority and specimen signatures of each Person who executed this Agreement for or on behalf of the Company, and (iii) containing any other certification that the Agents shall reasonably request.
(t) Good Standing. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to which the Company is obligated to deliver a certificate pursuant to Section 4(o) for which no waiver is applicable and excluding the date of this Agreement, the Company shall cause to be furnished to the Agents satisfactory evidence of the good standing of the Company and its subsidiaries in their respective jurisdictions of organization and their good standing in such other jurisdictions as the Agents may reasonably request, in each case in writing or any standard form of telecommunication from the appropriate governmental authorities of such jurisdictions.
(u) Agents’ Own Account; Clients’ Account. The Company consents to the Agents trading, in compliance with applicable laws, in the Common Shares for the Agents’ own account and for the account of their clients at the same time as sales of the Shares occur pursuant to this Agreement.
(v) Investment Limitation. The Company shall not invest, or otherwise use the proceeds received by the Company from its sale of the Shares in such a manner as would require the Company or any of its subsidiaries to register as an investment company under the Investment Company Act.
(w) Market Activities. The Company will not take, directly or indirectly, any action designed to or that might be reasonably expected to cause or result in stabilization or manipulation of the price of the Shares or any other reference security, whether to facilitate the sale or resale of the Shares or otherwise, and the Company will, and shall cause each of its affiliates to, comply
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with all applicable provisions of Regulation M and substantively equivalent provisions under Canadian Securities Laws. If the limitations of Rule 102 of Regulation M (“Rule 102”) do not apply with respect to the Shares or any other reference security pursuant to any exception set forth in Section (d) of Rule 102, then promptly upon notice from the Agents (or, if later, at the time stated in the notice), the Company will, and shall cause each of its affiliates to, comply with Rule 102 as though such exception were not available but the other provisions of Rule 102 (as interpreted by the Commission) did apply. The Company shall promptly notify the Agents if it no longer meets the requirements set forth in Section (d) of Rule 102.
(x) Notice of Other Sale. Without the written consent of the Agents, the Company will not, directly or indirectly, offer to sell, sell, contract to sell, grant any option to sell or otherwise dispose of any Common Shares, securities convertible into or exchangeable for Common Shares or warrants or other rights to purchase or acquire Common Shares (other than Shares hereunder) (each, a “Proposed Transaction”), during the period beginning on the third Trading Day immediately prior to the date on which any Issuance Notice is delivered to the Agents hereunder and ending on the third Trading Day immediately following the Settlement Date with respect to Shares sold pursuant to such Issuance Notice. The Company will not directly or indirectly enter into any other “at the market” or continuous equity transaction offer to sell, sell, contract to sell, grant any option to sell or otherwise dispose of any Common Shares (other than the Shares offered pursuant to this Agreement) or securities convertible into or exchangeable for Common Shares, warrants or any rights to purchase or acquire, Common Shares prior to the termination of this Agreement. Notwithstanding the foregoing, such requirements and restrictions will not be applicable in connection with the Company’s (i) issuance or sale of Common Shares, options to purchase Common Shares, equity awards to purchase Common Shares or Common Shares issuable upon the exercise of options or other equity awards pursuant to any employee or director share option, incentive or benefit plan, share purchase or ownership plan, long-term incentive plan, dividend reinvestment plan, inducement award under TSX or NYSE rules or other compensation plan of the Company or its subsidiaries, as in effect on the date of this Agreement and disclosed in the Registration Statement and Prospectuses, (ii) issuance or sale of Common Shares issuable upon exchange, conversion or redemption of securities or the exercise or vesting of warrants, options or other equity awards outstanding at the date of this Agreement, (iii) issuance or sale of Common Shares or securities convertible into or exchangeable for Common Shares as consideration for mergers, acquisitions, other business combinations, joint ventures or strategic alliances or commercial transactions or arrangements occurring after the date of this Agreement which are not used for capital raising purposes, provided that the aggregate number of Common Shares issued or sold under this subsection (iii) shall not exceed 5% of the number of Common Shares outstanding immediately prior to giving effect to such issuance and (iv) modification of any outstanding options, warrants or any other rights to purchase or acquire Common Shares.
Section 5. CONDITIONS TO DELIVERY OF ISSUANCE NOTICES AND TO SETTLEMENT
(a) Conditions Precedent to the Right of the Company to Deliver an Issuance Notice and the Obligation of the Agents to Sell Shares. The right of the Company to deliver an Issuance Notice hereunder is subject to the satisfaction, on the date of delivery of such Issuance Notice, and the obligation of each Agent to use its commercially reasonable efforts to place Shares during the applicable period set forth in the Issuance Notice is subject to the satisfaction, on each Trading
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Day during the applicable period set forth in the Issuance Notice, of each of the following conditions:
| (i) | Accuracy of the Company’s Representations and Warranties; Performance by the Company. The Company shall have delivered the certificate required to be delivered pursuant to Section 4(o) on or before the date on which delivery of such certificate is required pursuant to Section 4(o). The Company shall have performed, satisfied and complied with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to such date, including, but not limited to, the covenants contained in Section 4(m), Section 4(q), Section 4(r) and Section 4(s). |
| (ii) | No Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby that prohibits or directly and materially adversely affects any of the transactions contemplated by this Agreement, and no proceeding shall have been commenced that may have the effect of prohibiting or materially adversely affecting any of the transactions contemplated by this Agreement. |
| (iii) | Material Adverse Changes. Except as disclosed in the Registration Statement and the Prospectuses, (a) in the judgment of the Agents, there shall not have occurred any Material Adverse Change; and (b) there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any securities of the Company or any of its subsidiaries by any “nationally recognized statistical rating organization” as such term is defined for purposes of Section 3(a)(62) of the Exchange Act. |
| (iv) | No Suspension of Trading in or Delisting of Common Shares; Other Events. The trading of the Common Shares (including without limitation the Shares) shall not have been suspended by the Commission, the Canadian Qualifying Authorities, the NYSE, the TSX or FINRA and the Common Shares (including without limitation the Shares) shall have been approved for listing or quotation on and shall not have been delisted from the NYSE, the TSX or any of their constituent markets. There shall not have occurred (and be continuing in the case of occurrences under clauses (i) and (ii) below) any of the following: (i) trading or quotation in any of the Company’s securities shall have been suspended or limited by the Commission or by the NYSE or the TSX or trading in securities generally on either the NYSE or the TSX shall have been suspended or limited, or minimum or maximum prices shall have been generally established on any of such stock exchanges by the Commission, the Canadian Qualifying Authorities or FINRA; (ii) a general banking moratorium shall have been declared by any of U.S. or Canadian federal or New York authorities; or (iii) there shall have occurred any outbreak or escalation of national or international hostilities or any crisis or calamity, or any |
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| change in the United States or international financial markets, or any substantial change or development involving a prospective substantial change in United States’, Canadian or international political, financial or economic conditions, as in the judgment of the Agents, is material and adverse and makes it impracticable to market the Shares in the manner and on the terms described in the Prospectuses or to enforce contracts for the sale of securities. |
| (v) | Approval for Listing. The Shares shall have been (i) authorized for listing on the NYSE, subject only to notice of issuance; and (ii) conditionally approved for listing on the TSX, subject only to fulfilling customary conditions with the TSX. |
| (vi) | Canadian Prospectus Supplement. The Canadian Prospectus Supplement shall have been filed with the Canadian Qualifying Authorities under the Canadian Shelf Procedures and in accordance with this Agreement and all requests for additional information on the part of the Canadian Qualifying Authorities shall have been complied with to the reasonable satisfaction of the Agents and the Agents’ counsel and the Translation Decision shall remain in full force and effect without amendment. |
(b) Documents Required to be Delivered on each Issuance Notice Date. The Agents’ obligation to use its commercially reasonable efforts to place Shares hereunder shall additionally be conditioned upon the delivery to the Agents on or before the Issuance Notice Date of a certificate in form and substance reasonably satisfactory to the applicable Agent, executed by the Chief Executive Officer, President or Chief Financial Officer of the Company, to the effect that all conditions to the delivery of such Issuance Notice shall have been satisfied as at the date of such certificate (which certificate shall not be required if the foregoing representations shall be set forth in the Issuance Notice).
(c) No Misstatement or Material Omission. The Agents shall not have advised the Company that the Registration Statement or the Prospectuses, or any amendment or supplement thereto, contains an untrue statement of fact that in the Agents’ reasonable opinion is material, or omits to state a fact that in the Agents’ reasonable opinion is material and is required to be stated therein or is necessary to make the statements therein not misleading or contains a misrepresentation as defined under Canadian Securities Laws.
Section 6. INDEMNIFICATION AND CONTRIBUTION
(a) Indemnification of the Agents. The Company agrees to indemnify and hold harmless each Agent, its officers and employees, and each person, if any, who controls each Agent within the meaning of the Securities Act or the Exchange Act against any loss, claim, damage, liability or expense, as incurred, to which each Agent or such officer, employee or controlling person may become subject, under the Securities Act, the Exchange Act, Canadian Securities Laws, other federal, provincial or state statutory law or regulation, or the laws or regulations of foreign jurisdictions where Shares have been offered or sold or at common law or otherwise (including in settlement of any litigation), insofar as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises out of or is based upon (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, or
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any amendment thereto, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading; (ii) any untrue statement or alleged untrue statement of a material fact contained in any Free Writing Prospectus that the Company has used, referred to or filed, or is required to file, pursuant to Rule 433(d) of the Securities Act or the Prospectuses (or any amendment or supplement thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; (iii) the failure of the Canadian Base Prospectus or the Canadian Prospectuses or any amendment or supplement to the Canadian Base Prospectus or the Canadian Prospectuses to contain full, true and plain disclosure of all material facts relating to the Common Shares and to the Company or (iv) any act or failure to act or any alleged act or failure to act by the Agents in connection with, or relating in any manner to, the Common Shares or the offering contemplated hereby, and which is included as part of or referred to in any loss, claim, damage, liability or action arising out of or based upon any matter covered by clause (i), (ii) or (iii) above, provided that the Company shall not be liable under this clause (iv) to the extent that a court of competent jurisdiction shall have determined by a final judgment that such loss, claim, damage, liability or action resulted directly from any such acts or failures to act undertaken or omitted to be taken by an Agent through its bad faith, or willful misconduct, and to reimburse the Agents and each such officer, employee and controlling person for any and all expenses (including the fees and disbursements of counsel chosen by the Agents) as such expenses are reasonably incurred by the Agents or such officer, employee or controlling person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action; provided, however, that the foregoing indemnity agreement shall not apply to any loss, claim, damage, liability or expense to the extent, but only to the extent, arising out of or based upon any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with written information furnished to the Company by the Agents expressly for use in the Registration Statement, any such Free Writing Prospectus or the Prospectuses (or any amendment or supplement thereto), it being understood and agreed that the only such information furnished by the Agents to the Company consists solely of the names of the Agents. The indemnity agreement set forth in this Section 6(a) shall be in addition to any liabilities that the Company may otherwise have.
(b) Notifications and Other Indemnification Procedures. Promptly after receipt by an indemnified party under this Section 6 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party under this Section 6, notify the indemnifying party in writing of the commencement thereof, but the omission so to notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party for contribution or otherwise than under the indemnity agreement contained in this Section 6 or to the extent it is not prejudiced as a proximate result of such failure. In case any such action is brought against any indemnified party and such indemnified party seeks or intends to seek indemnity from an indemnifying party, the indemnifying party will be entitled to participate in, and, to the extent that it shall elect, jointly with all other indemnifying parties similarly notified, by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense thereof with counsel reasonably satisfactory to such indemnified party; provided, however, if the defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that a conflict may arise between the positions of the indemnifying party and the indemnified party in conducting the defense of any such action or that
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there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, the indemnified party or parties shall have the right to select separate counsel to assume such legal defenses and to otherwise participate in the defense of such action on behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to such indemnified party of such indemnifying party’s election so to assume the defense of such action and approval by the indemnified party of counsel, the indemnifying party will not be liable to such indemnified party under this Section 6 for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified party shall have employed separate counsel in accordance with the proviso to the preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the fees and expenses of more than one separate counsel (together with local counsel), representing the indemnified parties who are parties to such action), which counsel (together with any local counsel) for the indemnified parties shall be selected by the Agents (in the case of counsel for the indemnified parties referred to in Section 6(a) above), (ii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of commencement of the action or (iii) the indemnifying party has authorized in writing the employment of counsel for the indemnified party at the expense of the indemnifying party, in each of which cases the fees and expenses of counsel shall be at the expense of the indemnifying party and shall be paid as they are incurred.
(c) Settlements. The indemnifying party under this Section 6 shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party against any loss, claim, damage, liability or expense by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by Section 6(b) hereof, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request; and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement, compromise or consent to the entry of judgment in any pending or threatened action, suit or proceeding in respect of which any indemnified party is or could have been a party and indemnity was or could have been sought hereunder by such indemnified party, unless such settlement, compromise or consent includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such action, suit or proceeding.
(d) Contribution. If the indemnification provided for in this Section 6 is for any reason held to be unavailable to or otherwise insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount paid or payable by such indemnified party, as incurred, as a result of any losses, claims, damages, liabilities or expenses referred to therein (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Agents, on the other hand, from the offering of the Shares pursuant to this Agreement; or (ii) if the allocation provided by clause (i) above is not permitted by applicable
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laws, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, on the one hand, and the Agents, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative benefits received by the Company, on the one hand, and the Agents, on the other hand, in connection with the offering of the Shares pursuant to this Agreement shall be deemed to be in the same respective proportions as the total gross proceeds from the offering of the Shares (before deducting expenses) received by the Company bear to the total commissions received by the Agents. The relative fault of the Company, on the one hand, and the Agents, on the other hand, shall be determined by reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company, on the one hand, or the Agents, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in Section 6(b), any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The provisions set forth in Section 6(b) with respect to notice of commencement of any action shall apply if a claim for contribution is to be made under this Section 6(d); provided, however, that no additional notice shall be required with respect to any action for which notice has been given under Section 6(b) for purposes of indemnification.
The Company and the Agents agree that it would not be just and equitable if contribution pursuant to this Section 6(d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in this Section 6(d).
Notwithstanding the provisions of this Section 6(d), the Agents shall not be required to contribute any amount in excess of the agent fees received by the Agents in connection with the offering contemplated hereby. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 6(d), each officer and employee of the Agents and each person, if any, who controls each Agent within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as the Agents, and each director of the Company, each officer of the Company who signed the Registration Statement or the Canadian Prospectuses, and each person, if any, who controls the Company with the meaning of the Securities Act and the Exchange Act shall have the same rights to contribution as the Company.
Section 7. TERMINATION & SURVIVAL
(a) Term. Subject to the provisions of this Section 7, the term of this Agreement shall continue from the date of this Agreement until the end of the Agency Period, unless earlier terminated by the parties to this Agreement pursuant to this Section 7.
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(b) Termination; Survival Following Termination.
| (i) | The Company shall have the right, by giving ten (10) days’ written notice to terminate this Agreement in its sole discretion with respect to one Agent or the entire Agreement; provided that, (A) if the Company terminates this Agreement after an Agent confirms to the Company any sale of Shares, the Company shall remain obligated to comply with Section 3(b)(v) with respect to such Shares and (B) Section 2, Section 6, Section 7 and Section 8 shall survive termination of this Agreement. If termination shall occur prior to the Settlement Date for any sale of Shares, such sale shall nevertheless settle in accordance with the terms of this Agreement. |
| (ii) | Each of the Agents shall have the right, by giving ten (10) days’ written notice to terminate this Agreement in its sole discretion with respect to itself, but not with respect to any other Agent, at any time after the date of this Agreement. Any such termination shall be without liability of any party to any other party except that the provisions of Section 2, Section 6, Section 7 and Section 8 shall survive termination of this Agreement. If termination shall occur prior to the Settlement Date for any sale of Shares, such sale shall nevertheless settle in accordance with the terms of this Agreement. |
| (iii) | In addition to the survival provision of Section 7(b)(i) and Section 7(b)(ii), the respective indemnities, agreements, representations, warranties and other statements of the Company, of its officers and of the Agents set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of the Agents or the Company or any of its or their partners, officers or directors or any controlling person, as the case may be, and, anything herein to the contrary notwithstanding, will survive delivery of and payment for the Shares sold hereunder and any termination of this Agreement. |
Section 8. MISCELLANEOUS
(a) Press Releases and Disclosure. As soon as practicable following the date of this Agreement, the Company shall issue a press release complying with the terms and limitations provided in Rule 134 under the Securities Act and (i) describing the material terms of the transactions contemplated hereby, (ii) announcing that the Company has entered into this Agreement, (iii) indicating that the U.S. Base Prospectus and the Canadian Prospectus Supplement have been or will be filed, (iv) specifying where and how a purchaser of Shares may obtain a copy of this Agreement, the U.S. Prospectus, and the Canadian Prospectus Supplement, and (v) if applicable, indicating that the completion of the distribution of Shares would constitute a material fact or material change. The Company shall timely file a Form 8-K, with this Agreement attached as an exhibit thereto, and make similar filings in Canada, describing the material terms of the transactions contemplated hereby, and the Company shall consult with the Agents prior to making such disclosures, and the parties hereto shall use all commercially reasonable efforts, acting in good faith, to agree upon a text for such disclosures that is reasonably satisfactory to all parties hereto. No party hereto shall issue thereafter any press release or like public statement (including, without limitation, any disclosure required in reports filed with the Commission pursuant to the
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Exchange Act or with the Canadian Qualifying Authorities pursuant to Canadian Securities Laws) related to this Agreement or any of the transactions contemplated hereby without the prior written approval of the other party hereto, except as may be necessary or appropriate in the reasonable opinion of the party seeking to make disclosure to comply with the requirements of applicable laws or stock exchange rules. If any such press release or like public statement is so required, the party making such disclosure shall consult with the other party prior to making such disclosure, and the parties shall use all commercially reasonable efforts, acting in good faith, to agree upon a text for such disclosure that is reasonably satisfactory to all parties hereto.
(b) No Advisory or Fiduciary Relationship. The Company acknowledges and agrees that (i) the transactions contemplated by this Agreement, including the determination of any fees, are arm’s-length commercial transactions between the Company and the Agents, (ii) when acting as a principal under this Agreement, each Agent is and has been acting solely as a principal is not the agent or fiduciary of the Company, or its stockholders, creditors, employees or any other party, (iii) the Agents have not assumed nor will assume an advisory or fiduciary responsibility in favor of the Company with respect to the transactions contemplated hereby or the process leading thereto (irrespective of whether the Agents have advised or are currently advising the Company on other matters) and the Agents do not have any obligation to the Company with respect to the transactions contemplated hereby except the obligations expressly set forth in this Agreement, (iv) each of the Agents and its respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company, and (v) none of the Agents has provided any legal, accounting, regulatory or tax advice with respect to the transactions contemplated hereby and the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
(c) Research Analyst Independence. The Company acknowledges that each Agent’s research analysts and research departments are required to and should be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and as such the Agents’ research analysts may hold views and make statements or investment recommendations and/or publish research reports with respect to the Company or the offering that differ from the views of their respective investment banking divisions. The Company understands that each Agent is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short positions in debt or equity securities of the companies that may be the subject of the transactions contemplated by this Agreement.
(d) Notices. All communications hereunder shall be in writing and shall be mailed, hand delivered or emailed and confirmed to the parties hereto as follows:
If to the Agents:
TD Securities (USA) LLC
1 Vanderbilt Avenue
New York, NY 10017
Attention: CIB Legal
Email: [***]
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TD Securities Inc.
66 Wellington Street West, 10th Floor
Toronto, Ontario M5K 1A2
Attention: CIB Legal
Email: [***]
with a copy (which shall not constitute notice) to:
Skadden, Arps, Slate, Meagher & Flom LLP
One Manhattan West
New York, NY 10001-8602
Attention: Ryan J. Dzierniejko
Email: [***]
Blake, Cassels & Graydon LLP
1133 Melville Street, Suite 3500
Vancouver, British Columbia V6E 4E5
Attention: Bob Wooder / Kathleen Keilty
Email: [***]
If to the Company:
Lithium Americas Corp.
Suite 3260, 666 Burrard Street
Vancouver, British Columbia V6C 2X8
Attention: Jonathan Evans, President & Chief Executive Officer
Email: [***]
with a copy (which shall not constitute notice) to:
Vinson & Elkins LLP
845 Texas Avenue, Suite 4700
Houston, Texas 77002
Attention: Jackson A. O’Maley; Benjamin N. Heriaud
Email: [***]
Cassels Brock & Blackwell LLP
885 West Georgia Street, Suite 2200
Vancouver, British Columbia V6C 3E8
Attention: David Redford
Email: [***]
Any party hereto may change the address for receipt of communications by giving written notice to the others in accordance with this Section 8(d).
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(e) Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto, and to the benefit of the employees, officers and directors and controlling persons referred to in Section 6, and in each case their respective successors, and no other person will have any right or obligation hereunder. The term “successors” shall not include any purchaser of the Shares as such from the Agents merely by reason of such purchase.
(f) Partial Unenforceability. The invalidity or unenforceability of any Article, Section, paragraph or provision of this Agreement shall not affect the validity or enforceability of any other Article, Section, paragraph or provision hereof. If any Article, Section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.
(g) Governing Law Provisions. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York applicable to agreements made and to be performed in such state. Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the Borough of Manhattan in the City of New York or the courts of the State of New York in each case located in the Borough of Manhattan in the City of New York (collectively, the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a judgment of any such court (a “Related Judgment”), as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit, action or other proceeding brought in any such court has been brought in an inconvenient forum.
(h) Judgment Currency. In respect of any judgment or order given or made for any amount due hereunder that is expressed and paid in a currency (the “Judgment Currency”) other than United States dollars, the Company will indemnify the Agents against any loss incurred by the Agents as a result of any variation as between (i) the rate of exchange at which the United States dollar amount is converted into the judgment currency for the purpose of such judgment or order and (ii) the rate of exchange at which the Agents are able to purchase United States dollars with the amount of judgment currency actually received by the Agents. The foregoing indemnity shall constitute a separate and independent obligation of the parties hereto and shall continue in full force and effect notwithstanding any such judgment or order as aforesaid. The term “rate of exchange” shall include any premiums and costs of exchange payable in connection with the purchase of or conversion into United States dollars.
(i) Recognition of the U.S. Special Resolution Regimes.
| i. | In the event that any Agent that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Agent of this Agreement, and any interest and obligation in or under this Agent, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States. |
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| ii. | In the event that any Agent that is a Covered Entity or a BHC Act Affiliate of such Agent becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Agent are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States. |
As used in this Section 15(g):
“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).
“Covered Entity” means any of the following:
(i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
(ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or
(iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
“U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
(j) General Provisions. This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written or oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. This Agreement may be executed in two or more counterparts, each one of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument, and may be delivered by facsimile transmission or by electronic delivery of a portable document format (PDF) file. This Agreement may not be amended or modified unless in writing by all of the parties hereto, and no condition herein (express or implied) may be waived unless waived in writing by each party whom the condition is meant to benefit. The Article and Section headings herein are for the convenience of the parties only and shall not affect the construction or interpretation of this Agreement.
[Signature Page Immediately Follows]
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If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to the Company the enclosed copies hereof, whereupon this instrument, along with all counterparts hereof, shall become a binding agreement in accordance with its terms
| Very truly yours, | ||
| LITHIUM AMERICAS CORP. | ||
| By: | /s/ Jonathan Evans | |
| Name: | Jonathan Evans | |
| Title: | Chief Executive Officer and President | |
The foregoing Agreement is hereby confirmed and accepted by the Agents as of the date first above written.
| TD SECURITIES (USA) LLC | ||
| By: | /s/ Michael Murphy | |
| Name: | Michael Murphy | |
| Title: | Managing Director | |
| TD SECURITIES INC. | ||
| By: | /s/ Mark Tiberio | |
| Name: | Mark Tiberio | |
| Title: | Director, Investment Banking | |
Exhibit 4.6
Certain identified information in this Agreement denoted with “[***]” has been excluded from this exhibit pursuant to Item 601(b)(10)(iv) of Regulation S-K because it is both not material and of the type that the registrant treats as private and confidential.
NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL SELECTED BY THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY SATISFACTORY TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT, OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD (X) PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT OR (Y) TO AN ACCREDITED INVESTOR IN A PRIVATE TRANSACTION. ANY TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE, INCLUDING SECTIONS 3(c)(iii) AND 18 HEREOF. THE PRINCIPAL AMOUNT REPRESENTED BY THIS NOTE AND, ACCORDINGLY, THE SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS OR MORE THAN THE AMOUNT SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 3(c)(iii) OF THIS NOTE AND CAPITALIZED INTEREST.
THIS NOTE IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR UNITED STATES FEDERAL INCOME TAX PURPOSES. FOR INFORMATION REGARDING THE ISSUE PRICE, THE TOTAL AMOUNT OF ORIGINAL ISSUE DISCOUNT, THE ISSUE DATE, AND THE YIELD TO MATURITY OF THIS NOTE, PLEASE CONTACT THE GENERAL COUNSEL OF THE COMPANY AT THE FOLLOWING EMAIL ADDRESS: LEGAL@LITHIUMAMERICAS.COM, PHONE NUMBER: (778) 656-5820 OR ADDRESS: 3260 - 666 BURRARD STREET, VANCOUVER, BRITISH COLUMBIA, CANADA V6C 2X8.
UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY AND ANY SECURITY ISSUED ON CONVERSION HEREOF MUST NOT TRADE THE SECURITY BEFORE AUGUST 2, 2025.
LITHIUM AMERICAS CORP.
CONVERTIBLE NOTE
| Issuance Date: April 1, 2025 | Original Principal Amount: U.S. $195,000,000 |
FOR VALUE RECEIVED, Lithium Americas Corp., a company existing under the laws of the Province of British Columbia, Canada (the “Company”), hereby promises to pay to OMF Fund IV SPV M LLC or its registered assigns (the “Holder”) in cash the amount set forth above as the Original Principal Amount (as (x) reduced pursuant to the terms hereof pursuant to redemption, conversion or otherwise or (y) increased pursuant to one or more elections by the Company to pay Capitalized Interest in respect of Interest (as defined below), the “Principal”) when due, whether upon the Maturity Date, acceleration, redemption or otherwise (in each case in accordance with the terms hereof) and to pay interest (“Interest”) on any outstanding Principal at
the applicable Interest Rate from the date set out above as the issuance date (the “Issuance Date”) until the same becomes due and payable, whether upon the Maturity Date, an Interest Date or upon acceleration, conversion, redemption or otherwise (in each case in accordance with the terms hereof). This Convertible Note (including all Convertible Notes issued in exchange, transfer or replacement hereof, this “Note”) has been issued pursuant to the Transaction Agreement. Certain capitalized terms used herein are defined in Section 32.
(1) PAYMENTS OF PRINCIPAL. On the Maturity Date, the Company shall pay to the Holder an amount in cash representing all outstanding Principal and any accrued and unpaid Interest. Except as specifically provided for in this Note, the Company is not required or permitted to prepay any portion of the outstanding Principal.
(2) INTEREST; INTEREST RATE; DEFAULT RATE.
(a) Interest on the Principal amount of this Note shall commence accruing on the Issuance Date from day to day, both before and after default, demand, maturity and judgment, at the Interest Rate and shall be computed on the basis of a 360-day year and shall be payable quarterly in arrears on the last Business Day of March, June, September and December of each year following the Issuance Date through the Maturity Date (each, an “Interest Date”) with the first (1st) Interest Date being June 30, 2025. Interest shall be payable on each Interest Date, to the record holder of this Note on the applicable Interest Date, at the option of the Company, either as (i) Cash Interest or (ii) Capitalized Interest. The Company shall deliver a written notice (an “Interest Election Notice”) to the Holder on or prior to the date that is five (5) Business Days immediately prior to the applicable Interest Date, which Interest Election Notice either (a) elects that Interest to be paid on such Interest Date shall be paid entirely as Cash Interest, or (b) elects that Interest to be paid on such Interest Date shall be paid entirely as Capitalized Interest; provided that notwithstanding anything to the contrary herein; upon the occurrence and during an Event of Default, all Interest shall be paid entirely as Cash Interest. If the Company does not timely deliver an Interest Election Notice in accordance with this Section 2(a), then the Company shall be deemed to have delivered an irrevocable Interest Election Notice confirming the payment of Interest as Capitalized Interest on such Interest Date.
(b) Interest on this Note shall accrue at 9.875% per annum (the “Interest Rate”) and be payable by way of inclusion of the Interest in the Conversion Amount (as defined in Section 3(b)(i)) on each Conversion Date (as defined in Section 3(c)(i)) in accordance with Section 3(b)(i). From and after the occurrence and during the continuance of any Event of Default (as defined below), the Interest Rate shall be increased to 11.875% per annum (the “Default Rate”). In the event that such Event of Default is subsequently cured or waived in writing by the Holder in its sole discretion (and no other Event of Default then exists), the adjustment to the Interest Rate referred to in the preceding sentence shall cease to be effective as of the date of such cure or waiver; provided, that the Interest as calculated and unpaid at such increased rate during the continuance of such Event of Default shall continue to apply to the extent relating to the days after the occurrence of such Event of Default through and including the date of such cure or waiver of such Event of Default.
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(3) CONVERSION OF NOTES. At any time or times after the Issuance Date and prior to the Maturity Date, this Note shall be convertible into validly issued, fully paid and nonassessable Common Shares, on the terms and conditions set forth in this Section 3.
(a) Holder Optional Conversion Right. At any time or times on or after the Issuance Date and prior to the Maturity Date, the Holder shall be entitled to convert all or any portion of the outstanding and unpaid Conversion Amount, as selected by the Holder, into validly issued, fully paid and nonassessable Common Shares in accordance with Section 3(c)(i)—(iii), at the Conversion Rate (as defined below); provided that the delivery of the Common Shares will be subject to Section 3(e) hereof. The Company shall not issue any fraction of a Common Share upon any conversion. If the issuance would result in the issuance of a fraction of a Common Share, the Company shall round such fraction of a Common Share down to the nearest whole share. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of the Transfer Agent (as defined below)) that may be payable with respect to the issuance and delivery of Common Shares upon conversion of any Conversion Amount but excluding any such taxes due because the Holder requests such Common Shares to be issued in a name other than the Holder’s name, in which case the Holder will pay such taxes.
(b) Conversion Rate. The number of Common Shares issuable upon conversion of any Conversion Amount pursuant to Section 3(a), shall be determined by dividing (x) such Conversion Amount by (y) the Conversion Price (the “Conversion Rate”).
(i) “Conversion Amount” means the sum of (A) the portion of the then outstanding and unpaid Principal (including, without limitation, Capitalized Interest, if any) to be converted, redeemed or otherwise with respect to which this determination is being made and (B) accrued and unpaid Interest, if any, with respect to such Principal.
(ii) “Conversion Price” means, as of any Conversion Date or other date of determination, $3.78, subject to adjustment as provided herein.
(c) Mechanics of Conversion.
(i) Holder Optional Conversion. To convert any Conversion Amount into Common Shares on any date (a “Conversion Date”) in accordance with Section 3(a), the Holder shall transmit by electronic mail (or otherwise deliver), for delivery on or prior to 5:00 p.m., New York time, on such date, a copy of an executed notice of conversion in the form attached hereto as Exhibit I (a “Conversion Notice”) to the Company. If required by Section 3(c)(iii), but without delaying the Company’s requirement to deliver Common Shares on the applicable Holder Optional Conversion Share Delivery Date (as defined below), the Holder shall surrender this Note to a common carrier for delivery to the Company as soon as reasonably practicable on or following the applicable Conversion Date on which the Holder submitted a Conversion Notice to the Company electing to convert all or a portion of the Conversion Amount as represented on such Conversion Notice (or an indemnification undertaking with respect to this Note in the
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case of its loss, theft, destruction or mutilation in compliance with the procedures set forth in Section 19(b)). In lieu of indicating the portion of the outstanding and unpaid Conversion Amount that the Holder elects to convert, the Holder may indicate in a Conversion Notice the number of Common Shares it seeks to receive upon conversion of any portion of this Note and the reduction of the outstanding and unpaid Conversion Amount pursuant to such conversion shall be determined at the end of such Conversion Date by multiplying such number of Common Shares by the applicable Conversion Price. No ink-original Conversion Notice shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Conversion Notice be required. On or before the first (1st) Trading Day following the date of delivery of a Conversion Notice, the Company shall transmit by electronic mail a confirmation of receipt of such Conversion Notice in substantially the form attached as Exhibit II, such confirmation including certain representations as to whether such Common Shares may then be resold pursuant to Rule 144 or an effective and available registration statement, to the Holder and the Company’s transfer agent (the “Transfer Agent”), which confirmation shall constitute an instruction to the Transfer Agent (or shall otherwise be accompanied by an instruction to the Transfer Agent) to process such Conversion Notice in accordance with the terms therein. On or before the third (3rd) Trading Day following the date on which the Holder has delivered the applicable Conversion Notice to the Company (a “Holder Optional Conversion Share Delivery Date”), the Company shall, at any time on or after August 2, 2025 (and if before such date, the deposit will occur as described below), (x) credit such aggregate number of Common Shares to which the Holder is entitled pursuant to such Conversion Notice without any legends to the Holder’s or its designee’s balance account with The Canadian Depository for Securities Limited (“CDS”) or (y) provided that the Transfer Agent is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program and either (A) the applicable Conversion Shares are subject to an effective resale registration statement in favor of the Holder or (B) if converted at a time when Rule 144 would be available for resale of the applicable Conversion Shares by the Holder, credit such aggregate number of applicable Conversion Shares to which the Holder is entitled pursuant to such conversion to the Holder’s or its designee’s balance account with DTC through its Deposit / Withdrawal At Custodian system, or (z) if (A) the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program or (B) the applicable Conversion Shares are not subject to an effective resale registration statement in favor of the Holder and, if converted at a time when Rule 144 would not be available for resale of the applicable Conversion Shares by the Holder, issue and deliver to the address or account, as applicable, as specified in the Conversion Notice, a certificate, direct registration system advice or book-entry notation, as applicable, registered in the name of the Holder or its permitted designee, for the number of Common Shares to which the Holder shall be entitled pursuant to such conversion. Prior to August 2, 2025, the Company will issue and deliver to the address or account, as applicable, as specified in the Conversion Notice, a certificate, direct registration system advice or book-entry notation, as applicable, registered in the name of the Holder or its permitted designee, for the number of Common Shares to which the Holder shall be entitled pursuant to such conversion. In the event that any Conversion Shares at any time are not deposited into DTC or CDS, as applicable, the Company will use its commercially reasonable efforts, at the Holder’s
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request, to assist the Holder to deposit such Conversion Shares into DTC and/or CDS, as applicable, as soon as such deposits are reasonably practicable. If this Note is physically surrendered for conversion as required by Section 3(c)(iii) and the then outstanding Principal of this Note is greater than the Principal portion of the Conversion Amount being converted, then the Company shall as soon as practicable after delivery of this Note and at its own expense, issue and deliver to the Holder a new Note (in accordance with Section 19(d)) representing the outstanding Principal not converted. The Company shall treat the Person or Persons entitled to receive the Common Shares issuable upon a conversion of this Note for all purposes as the record holder or holders of such Common Shares on the applicable Conversion Date, irrespective of the date such Conversion Shares are credited to the Holder’s account with DTC or CDS, as applicable, or the date of delivery of the certificates evidencing such Conversion Shares, as the case may be. The Company’s obligations to issue and deliver Common Shares in accordance with the terms and subject to the conditions hereof are absolute and unconditional. Notwithstanding anything to the contrary contained in this Note or the Registration Rights Agreement, after the effective date of the Registration Statement and prior to the Holder’s receipt of the notice of a Grace Period (as defined in the Registration Rights Agreement), the Company shall, upon receipt of reasonably requested documentation and letters of representation, cause the Transfer Agent to deliver unlegended Common Shares to the Holder (or its designee) in connection with any sale of Registrable Securities with respect to which the Holder has entered into a contract for sale, and delivered a copy of the prospectus included as part of the particular Registration Statement to the extent applicable, and for which the Holder has not yet settled. While any Notes are outstanding, the Company shall use a transfer agent that participates in the DTC Fast Automated Securities Transfer Program and CDS. Notwithstanding anything to the contrary in this Note, if the Conversion Shares are issued within four months and a day from the Issuance Date, such Conversion Shares will bear the following legend: “UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE AUGUST 2, 2025.”
(ii) Company’s Failure to Timely Convert. If the Company shall fail, other than by reason of a failure of a Holder to comply with its obligations hereunder, on or prior to the Holder Optional Conversion Share Delivery Date either (I) to issue and deliver a certificate, direct registration system advice or book-entry notation to the Holder, if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program or if converted at a time when the applicable Conversion Shares are not subject to an effective resale registration statement in favor of the Holder and Rule 144 would not be available for resale of the applicable Conversion Shares by the Holder or if it is prior to August 2, 2025, or credit the Holder’s balance account (without any legends) with CDS or DTC, as applicable (if it is after August 2, 2025 in the case of CDS and the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program in the case of DTC) and in the case of DTC, (a) the applicable Conversion Shares are subject to an effective resale registration statement in favor of the Holder or (b) if converted at a time when Rule 144 would be available for resale of the applicable Conversion Shares by the Holder, for the number of Common Shares to which the Holder is entitled upon the
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conversion of any Conversion Amount or (II) in the case of DTC, if the Registration Statement is not available for the resale of the Common Shares that are the subject of the Conversion Notice (the “Unavailable Conversion Shares”) and the Company fails to promptly, but in no event later than as required pursuant to the Registration Rights Agreement (x) so notify the Holder and (y) deliver the Common Shares electronically without any restrictive legend by crediting such aggregate number of Common Shares to which the Holder is entitled pursuant to such conversion to the Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal At Custodian system (the event described in the immediately foregoing clause (II) together with an event described in clause (I) above, a “Conversion Failure”), then in addition to all other remedies available to the Holder (including under the Registration Rights Agreement), the Holder, upon written notice to the Company, may void its Conversion Notice with respect to, and retain or have returned, as the case may be, any portion of this Note that has not been converted pursuant to such Conversion Notice. Nothing herein shall limit the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing Common Shares (or to electronically deliver such Common Shares) upon conversion of this Note as required pursuant to the terms hereof.
(iii) Registration; Book-Entry. The Company shall maintain a register (the “Register”) for the recordation of the name and address of the Holder of this Note (and the name and address of any Person who is transferred all or any portion of this Note to the extent permitted by the terms hereof) and the Principal amount (and stated interest with respect thereto) held by the Holder (and any Person who is transferred all or any portion of this Note to the extent permitted by the terms hereof) (the “Registered Notes”). The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Company and the holders of the Notes shall treat each Person whose name is recorded in the Register as the owner of a Note for all purposes, including, without limitation, the right to receive payments of Principal and Interest hereunder, notwithstanding notice to the contrary. A Registered Note may be assigned, transferred or sold in whole or in part only by registration of such assignment, transfer or sale on the Register. Upon its receipt of a request to assign, transfer or sell all or part of any Registered Note by the Holder in accordance with Section 18, the Company shall record the information contained therein in the Register and issue one or more new Registered Notes in the same aggregate Principal amount as the Principal amount of the surrendered Registered Note to the designated assignee or transferee pursuant to Section 19. Notwithstanding anything to the contrary set forth herein, upon conversion of any portion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Company unless (A) the full Conversion Amount represented by this Note is being converted or (B) the Holder has provided the Company or the Company has provided the Holder, as applicable, with prior written notice (which notice may be included in a Conversion Notice) requesting reissuance of this Note upon physical surrender of this Note. The Holder and the Company shall maintain records showing the Principal and Interest converted and/or paid (as the case may be) and the dates of such conversions, and/or payments (as the case may be) or shall use such other method, reasonably satisfactory to the Holder and the Company, so as not to require physical surrender of this Note upon conversion.
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(d) Holder Conversion Limitation. Unless otherwise agreed in writing by both the Company and the Holder, the Company shall not effectuate any conversion of this Note or any Additional Notes, and the Holder shall not have any right to convert the Note or any Additional Notes, to the extent that such conversion would result in such Holder (together with the Holder’s Affiliates and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates, in each case, to the extent that such Affiliates and persons acting as a group are required to aggregate their beneficial ownership of Common Shares for purposes of the Relevant Section (as defined below) of the Exchange Act (“Attribution Parties”)), beneficially owning more than 9.99% of the number of shares of the Common Shares outstanding immediately after giving effect to the issuance of Common Shares issuable upon conversion of the Note and any Additional Notes, as applicable (subject to adjustment under this Section 3(d), the Holder’s “Beneficial Ownership Limitation”). For purposes of the foregoing sentence, the number of Common Shares beneficially owned by the Holder and their Attribution Parties shall include the number of Common Shares issuable upon conversion of any portion of the Note and any Additional Notes, as applicable, with respect to which such determination is being made, but shall exclude the number of shares of Common Shares which would be issuable upon (i) conversion of any remaining portion of the Note or any Additional Notes by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Attribution Parties. For purposes of this Section 3(d), (i) the determination of any “group” status shall be made in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, and (ii) the determination of “beneficial ownership” shall be made in accordance with the determination of whether a Person is a beneficial owner of more than 10% of the Common Shares outstanding for purposes of determining if such Person is subject to Section 16 of the Exchange Act, as determined in accordance with Section 16 of the Exchange Act and the rules and regulations promulgated thereunder (the applicable Section of the Exchange Act being referred to herein as the “Relevant Section”) (it being acknowledged and understood by the Holder that the Company is not representing to the Holder that such calculation is in compliance with the Relevant Section of the Exchange Act and that the Holder is solely responsible for the preparation of any schedules required to be filed in accordance therewith). To the extent that the limitations contained in this Section 3(d) apply to the Holder, the determination of whether any portion of the Note or the Additional Notes, as applicable, are convertible, and the portion thereof that is convertible in relation to other securities owned by the Holder and the Holder’s Attribution Parties, shall be calculated by the Holder and the submission of a Conversion Notice shall be deemed to be a determination by the Holder in relation to other securities owned by the Holder and the Holder’s Attribution Parties that the portion of the Note or Additional Notes, as applicable, set forth in the applicable Conversion Notice is convertible. Upon receipt of a Conversion Notice, the Company shall independently confirm whether the conversion of any portion of the Note or Additional Notes set forth in the Conversion Notice by the Holder would result in the violation by the Holder of its Beneficial Ownership Limitation and, if so, shall instruct the Holder of such violation and shall
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not effectuate any conversion of any portion of the Note or the Additional Notes that would result in such violation for the Holder. In making such determination, the Company shall be able to rely for all purposes on the information in a Conversion Notice as such Holder’s total beneficial ownership, inclusive of Attribution Parties. In the event that the issuance of Common Shares to the Holder upon the conversion of any portion of the Note or the Additional Notes results in the Holder being deemed to beneficially own, in the aggregate, more than the Holder’s Beneficial Ownership Limitation, the number of shares so issued by which the Holder’s aggregate beneficial ownership exceeds the Holder’s Beneficial Ownership Limitation (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the Excess Shares. Upon the written request of the Holder, the Company shall within two (2) Business Days confirm in writing to the Holder the number of Common Shares then outstanding. The Holder, upon notice to the Company, may increase or decrease its Beneficial Ownership Limitation, provided that the Beneficial Ownership Limitation in no event exceeds 19.99% of the Common Shares outstanding and the provisions of this Section 3(d) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the sixty-first (61st) day after such notice is delivered to the Company. The limitations contained in this paragraph shall apply to a successor Holder which successor Holder shall be subject to the same Beneficial Ownership Limitation as its transferor unless and until changed in accordance with this Section 3(d).
(e) Conversion Cap. To the extent that any issuance of Common Shares hereunder would result in the Holder holding more than the lesser of (i) 19.99% of the issued and outstanding Common Shares as of immediately prior to entry into the Transaction Agreement (such amount being, 43,707,080 Common Shares) and (ii) 19.99% of the issued and outstanding Common Shares at the time of conversion of any portion of the Note or the Additional Notes (the “Conversion Cap”), such amount of Common Shares over and above the applicable Conversion Cap will instead be paid to the Holder in cash on the same date that the Common Shares in respect of such conversion would have otherwise been issued in accordance with the terms hereof, with each Common Share to be valued at a price equal to the five-day volume weighted average trading price of a Common Share on the NYSE (or in the event that the Common Shares are not then listed on the NYSE, the TSX) ending on the Trading Day prior to the applicable Conversion Notice being delivered to the Company.
(4) RIGHTS UPON EVENT OF DEFAULT.
(a) Event of Default. Each of the following events shall constitute an “Event of Default” and each of the events in clauses (vi), (viii) and (ix) shall also constitute a “Bankruptcy Event of Default”:
(i) the failure of the Common Shares to be listed on an Eligible Market;
(ii) the Company’s failure to cure a Conversion Failure by delivery of the required number of Common Shares within five (5) Trading Days after the applicable Conversion Date, other than in any such case as a result of the failure by a Holder to comply with its obligations hereunder;
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(iii) the Company’s failure to pay to the Holder any amount of Principal, Interest, Redemption Price or any other fees or other obligations when and as due under this Note, any other Transaction Document or the Production Payment Agreement, except, (i) in the case of a failure to pay Interest, in which case only if such failure continues for a period of two (2) Business Days and (ii) in the case of failure to pay any fees or other obligations other than Principal, Interest and the Redemption Price when and as due, in which case only if such failure continues for a period of five (5) Business Days;
(iv) any representation or warranty confirmed or made by or on behalf of the Company (i) in any of the Transaction Documents or (ii) in any certificate, financial statement or other document provided by or on behalf of the Company in connection with the transactions contemplated by any Transaction Document shall, in any such case, be found to have been incorrect, false or misleading in any material respect when confirmed, made or deemed to have been made;
(v) (i) an event of default shall have occurred and be continuing under the DOE Loan or any other agreement or instrument evidencing, or under which the Company, an Intermediate Holding Company or the Project Company has outstanding at any time, any Indebtedness in an amount in excess of thirty million Dollars ($30,000,000) for thirty (30) days beyond any applicable grace or cure periods in the agreement or instrument evidencing such Indebtedness, or (ii) any other default or event of default occurs and is continuing under the DOE Loan or under any such other agreement or instrument, if the effect of such default or event of default is to accelerate the maturity of such Indebtedness;
(vi) the Company or General Motors Holdings LLC (“GM”) shall fail to perform or observe any material covenant or any other material term or obligation under any GM Investment Document, or any representation or warranty confirmed or made by or on behalf of the Company or GM in any GM Investment Document shall be found to have been incorrect, false or misleading in any material respect when confirmed, made or deemed to have been made, and such breach, default or misrepresentation (x) would entitle the other party to terminate any GM Investment Document as a result thereof and (y) shall continue unremedied beyond any applicable cure period set forth therein, or if no cure period is specified, thirty (30) days from the earlier of the Company’s knowledge or notice of such failure; provided that if such Person is proceeding with all requisite diligence and in good faith to cure such failure and such GM Investment Document has not been terminated by the other party, then, upon delivery by the Company of an officer’s certificate certifying the foregoing, providing a reasonably detailed description of such cure activities, and certifying that the outstanding default could not reasonably be expected to have an Material Adverse Effect while the Company continues to cure, at the written approval of the Required Holders the time within which such failure may be cured shall be extended to such date, not to exceed a total of thirty (30) additional days after the end of the initial thirty (30) day period, as shall be necessary for such Person to cure such failure;
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(vii) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, arrangement, relief of creditors, reorganization or other relief in respect of the Company, an Intermediate Holding Company or the Project Company or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator, monitor or similar official for the Company, the Intermediate Holding Companies or the Project Company or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed, undischarged or unbonded for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered;
(viii) any of the Company, an Intermediate Holding Company or the Project Company shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, arrangement, relief of creditors, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (v) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for such Company, Intermediate Holding Company or the Project Company or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
(ix) the Company, an Intermediate Holding Company or the Project Company shall become unable, admit in writing its inability, or publicly declare its intention not to, or fail generally to pay its debts as they become due;
(x) (i) one or more judgments for the payment of money shall be rendered against the Company, an Intermediate Holding Company or the Project Company and such judgements have not been paid, vacated, discharged or stayed or bonded pending appeal within sixty (60) days of occurrence thereof and the aggregate amount of all such judgments outstanding at any time (except to the extent any applicable insurer(s) have acknowledged liability therefor) exceeds thirty million Dollars ($30,000,000); or (ii) the Company, an Intermediate Holding Company or the Project Company shall fail within thirty (30) days to discharge one or more non-monetary judgments or orders which, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect, which judgments or orders, in any such case of clauses (i) or (ii), are not stayed on appeal or otherwise being appropriately contested in good faith by proper proceedings diligently pursued; provided that if such Person is proceeding with all requisite diligence and in good faith to cure such failure, then, upon delivery by the Company of an officer’s certificate certifying the foregoing, providing a reasonably detailed description of such cure activities, and certifying that the outstanding default could not reasonably be expected to have an Material Adverse Effect while the Company continues to cure, at the written approval of the Required Holders the time within which such failure may be cured shall be extended to such date, not to exceed a total of thirty (30) additional days after the end of the initial thirty (30) day period, as shall be necessary for such Person to cure such failure;
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(xi) breach or failure in any respect to comply with the covenants included in this Note or any other Transaction Document, which breach or failure shall continue unremedied for (a) in the case of any reporting obligation, forty-five (45) days and (b) in the case of any other covenant, thirty (30) days, in each case after the earlier of the Company’s or any Subsidiary’s knowledge of such breach or written notice thereof from the Holder; provided that in the case of (b), if such Person is proceeding with all requisite diligence and in good faith to cure such failure, then, upon delivery by the Company of an officer’s certificate certifying the foregoing, providing a reasonably detailed description of such cure activities, and certifying that the outstanding default could not reasonably be expected to have an Material Adverse Effect while the Company continues to cure, at the written approval of the Required Holders the time within which such failure may be cured shall be extended to such date, not to exceed a total of thirty (30) additional days after the end of the initial thirty (30) day period, as shall be necessary for such Person to cure such failure;
(xii) (A) the occurrence of any “default”, as defined in any Transaction Document (other than this Note) or the breach of any of the terms or provisions of any Transaction Document (other than this Note), which default or breach continues beyond any period of grace therein provided or, if no period of grace is provided, for thirty (30) days after the earlier of the Company or any Subsidiary’s knowledge of such breach or written notice thereof from the Holder or (B) other than as specifically set forth in another clause of this Section 4(a), the Company or any of its Subsidiaries breaches any of the covenants, terms or provisions of this Note, the Transaction Agreement or any other Transaction Document and such breach continues for a period of at least thirty (30) days after the earlier of the Company or any Subsidiary’s knowledge of such breach or written notice thereof from the Holder;
(xiii) any material provision of the Transaction Agreement, the Production Payment Agreement, the Registration Rights Agreement, this Note or other Transaction Document ceases to be valid, binding and enforceable in accordance with its terms (other than if solely caused by Holder or any of its Affiliates and provided that, for the avoidance of doubt, the Transaction Documents will not include any lithium offtake arrangements);
(xiv) (i) prior to the Project Completion Date, construction of the Mine or the Processing Facility shall be suspended for a period of sixty (60) consecutive days or ninety (90) days in the aggregate in any fiscal year, in each case, other than scheduled shutdowns or scheduled maintenance conducted in accordance with the Integrated Project Schedule; provided that if such suspension is the direct result of the occurrence of an Event of Force Majeure, if, before the end of such sixty (60) consecutive day period or ninety (90) day period, as applicable, the Project Company shall have agreed with the DOE in writing a remediation plan signed by the Project Company confirming its intent to resume construction (within no more than ninety (90) additional days) and the
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Project Company’s good faith belief that Substantial Completion can be achieved by the Substantial Completion Long Stop Date and Project Completion can be achieved by the Project Completion Long Stop Date, then such suspension of construction shall not be deemed an Event of Default unless work is not resumed within the period specified in, and undertaken in accordance with, the remediation plan; (ii) from and after the Project Completion Date, the Mine or the Processing Facility shall cease to operate for a period of sixty (60) consecutive days or ninety (90) days in the aggregate in any fiscal year, in each case, other than scheduled shutdowns or scheduled maintenance conducted in accordance with the Operating Plan; provided that if such cessation is the direct result of the occurrence of an Event of Force Majeure, if, before the end of such sixty (60) consecutive day period or ninety (90) day period, as applicable, the Project Company shall have agreed with the DOE in writing to a remediation plan signed by the Project Company confirming its intent to resume operation (within no more than ninety (90) additional days), then such cessation of operations shall not be deemed an Event of Default unless operations are not resumed within the period specified in, and undertaken in accordance with, the remediation plan; or (ii) the Project Company shall abandon, or suspend, agree in writing to abandon or suspend, or make any public statements regarding its intention to abandon, or suspend, the Project, the Mine or the Processing Facility, or take any action that could be deemed an “abandonment,” or “suspension.”
(xv) a Governmental Authority (i) lawfully condemns or assumes custody of all or substantially all of the property or assets of the Company and its Subsidiaries, taken as a whole; or (ii) takes lawful action to displace the management of, or the Company’s interest in, the Project Company;
(xvi) all or a material portion of the Project is destroyed or becomes permanently inoperative as a result of any condemnation, expropriation or taking (including by any Governmental Authority) of any portion of the Project, or any other event that causes a material portion of the Project to be damaged, destroyed or rendered unfit for normal use for any reason whatsoever, including through a failure of title (or defect therein) or any damage, destruction or loss of such property;
(xvii) the imposition or enforcement of any foreign exchange or currency controls, export restrictions relating to battery-grade lithium carbonate or other authorizations by any Governmental Authority which has a Material Adverse Effect on the Company’s ability to perform its obligations under the Transaction Documents;
(xviii) any event, or series of events or circumstances or changes in relation to the Project or the Project Company that has had or could reasonably be expected to have a Material Adverse Effect shall occur and be continuing;
(xix) a Change of Control occurs, unless the Company has submitted a Change of Control Redemption Notice to the Holder pursuant to Section (4)(d) prior to the occurrence of a Change of Control and any payment that is required to be made by the Company to the Holder in accordance with Section (4)(d) is paid in accordance thereof;
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(xx) (A) GM issues a DOE Put Notice (as defined in the LAC-GM JV LLCA), (B) the DOE Loan is terminated, (C) all conditions precedent for the funding of an applicable advance under the DOE Loan have been satisfied or waived by the DOE, but the DOE does not fund such advance in accordance with the terms of the DOE Loan for a period of thirty (30) days, or (D) a permanent injunction or other Order is issued and is continuing, or a statute, rule, regulation or executive order is promulgated or enacted by a Governmental Authority and is continuing, which restrains, enjoins, prohibits or otherwise makes illegal the consummation of the transactions contemplated under the DOE Loan;
(xxi) the use of the proceeds hereunder or under any other Transaction Document shall violate or cause any Person, including any Holder, to violate any Sanctions or Anti-Money Laundering Laws or other applicable Anti-Corruption Laws;
(xxii) any violation by any Project Entity or any Major Project Participant of any Sanctions, Anti-Money Laundering Laws or Anti-Corruption Laws;
(xxiii) all or any material portion of the Project Property is sold, transferred, subject to any Lien or assigned or disposed of without the consent of the Holder (other than pursuant to a Disposition expressly permitted hereunder or a Permitted Encumbrance, as applicable);
(xxiv) any of the following occurs; provided that if the Company is proceeding with all requisite diligence and in good faith to cure such failure, then, upon delivery by the Company of an officer’s certificate certifying the foregoing, providing a reasonably detailed description of such cure activities, and certifying that the outstanding default could not reasonably be expected to have an Material Adverse Effect while the Company continues to cure, at the written approval of the Required Holders the time within which such failure may be cured shall be extended to such date, not to exceed a total of thirty (30) days:
(A) any Transaction Document, any Major Project Document, any Project Document (to the extent it is not a Major Project Document, solely to the extent that such event results in a Material Adverse Effect) or any GM Investment Document at any time and for any reason in whole or in any material respect:
(1) is or becomes invalid, illegal, void or unenforceable or any party thereto has repudiated or disavowed or taken any action to challenge the validity or enforceability of such agreement;
(2) except as otherwise expressly permitted hereunder, ceases to be in full force and effect except at the stated termination date thereof, or shall be assigned or otherwise transferred or terminated by the Company, any Intermediate Holding Company or the Project Company, as applicable, prior to the repayment in full of this Note and all obligations hereunder and under the other Transaction Documents (other than with the prior written consent of the Required Holders); or
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(3) is suspended, revoked or terminated (other than upon expiration in accordance with its terms when fully performed);
(B) any Project Entity or any Major Project Participant (as defined in the DOE Loan as of the date hereof) shall fail to obtain, renew, maintain or comply (in any material respect) with any Required Approval (other than to the extent such Required Approval has expired pursuant to its terms and is no longer required in light of the relevant stage of development or operation of the Project) or any such Required Approval shall be rescinded, terminated, suspended, modified, withdrawn or withheld or shall be determined to be invalid or shall cease to be in full force and effect;
(C) any proceedings shall be commenced by or before any Governmental Authority for the purposes of rescinding, terminating, suspending, modifying, withdrawing or withholding any such Required Approval, and such proceeding is not: (A) dismissed within sixty (60) days of institution, including as a result of satisfaction of any judgement or settlement of any claim that does not otherwise separately result in an Event of Default hereunder; or (B) diligently contested or appealed by any Project Entity in accordance with the Permitted Contest Conditions or any Major Project Participant (as defined in the DOE Loan as of the date hereof), as applicable; or
(D) the Project Company shall cease to maintain Project Mining Claims and rights and/or access to sufficient water supply for the Project.
(b) Event of Default Mandatory Redemption Rights.
(i) At any time after the earlier of the Holder’s receipt of an Event of Default Notice (as defined below) and the Holder becoming aware of an Event of Default, if such Event of Default is continuing at the time of delivery of the Event of Default Notice then (A) the Holders of 25% of the aggregate principal amount of outstanding Notes (the “Directing Holders”) may require the Company to redeem all or any portion of this Note held by the Directing Holders or (B) the Company may redeem all or any portion of this Note, in each case by delivering written notice thereof (the “Event of Default Redemption Notice”) to the Holder or the Company, as applicable, which Event of Default Redemption Notice shall indicate the portion of this Note the Holder or the Company, as applicable, is electing for redemption. For the avoidance of doubt, the Company shall not be required to redeem any portion of this Note not held by the Directing Holders. The Company shall deliver the applicable Event of Default Redemption Price to the Directing Holders at a date of its determination within two (2) Business Days after the Directing Holders’ or the Company’s, as applicable, delivery of the Event of Default Redemption Notice (the “Event of Default Redemption Date”). Each portion of this Note subject to redemption by the Company pursuant to this Section 4(b) shall be redeemed by the Company in cash by wire transfer of immediately available funds at a price equal to the then outstanding and unpaid Principal and accrued and unpaid interest, if any, with respect to such Principal (the “Event of Default Redemption Price”). Redemptions required by this Section 4(b) shall be made in accordance with the provisions of Section 10(b). To the extent redemptions required by this Section 4(b) are deemed or determined by a court of
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competent jurisdiction to be prepayments of the Note by the Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section 4, but subject to Section 3(e), until the Event of Default Redemption Price is paid in full, the Conversion Amount submitted for redemption under this Section 4(b) may be converted, in whole or in part, by the Holder into Common Shares pursuant to Section 3. The parties hereto agree that in the event of the Company’s redemption of any portion of the Note under this Section 4(b), the Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for the Holder. Accordingly, any premium due under this Section 4(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its investment opportunity and not as a penalty.
(c) Mandatory Redemption upon Bankruptcy Event of Default. Notwithstanding anything to the contrary herein, and notwithstanding any conversion that is then required or in process, upon any Bankruptcy Event of Default, whether occurring prior to or following the Maturity Date, the Company shall immediately pay to the Holder an amount in cash equal to the Event of Default Redemption Price with respect to the Conversion Amount then held by the Holder (the “Bankruptcy Event of Default Redemption Price”), without the requirement for any notice or demand or other action by the Holder or any other Person; provided that the Holder may, at its sole discretion, waive such right to receive payment upon a Bankruptcy Event of Default, in whole or in part, and any such waiver shall not affect any other rights of the Holder hereunder, including any other rights in respect of such Bankruptcy Event of Default, any right to conversion, and any right to payment of the Event of Default Redemption Price or any other Redemption Price, as applicable. Redemption required by this Section 4(c) shall be made in accordance with the provisions of Section 10(b).
(d) Change of Control Redemption Right. Notwithstanding Section 5(a), no later than the later of (x) ten (10) days prior to the consummation of a Change of Control or Company Change of Control and (y) the public announcement of such Change of Control or Company Change of Control, the Company shall deliver written notice thereof via electronic mail or overnight courier to the Holder (a “Change of Control Redemption Notice”) setting forth a description of such Change of Control or Company Change of Control transaction in reasonable detail, the anticipated effective date of such Change of Control or Company Change of Control (the “Anticipated Change of Control Effective Date”) and including an offer by the Company to redeem, at the Holder’s election, any or all of the total then outstanding and unpaid Conversion Amount of this Note at the Change of Control Redemption Price (as defined below) (a “Change of Control Offer”) unless earlier converted pursuant to Section 3(a). Within seven (7) days after the Change of Control Redemption Notice is sent to the Holder (the “Change of Control Redemption Election Deadline”), the Holder shall deliver a written notice via electronic mail or overnight courier to the Company (a “Change of Control Redemption Election”) indicating the portion of the Conversion Amount the Holder is electing to require the Company to redeem, if any (the “Change of Control Redemption Amount”). If the Holder returns a Change of Control Redemption Election prior to the Change of Control Redemption Election Deadline, then on the latest of (x) the actual effective date of the date of control, and (y) the Anticipated Change of Control Effective Date (such latest date, the “Change of Control Redemption Date”), the
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Company shall redeem (a “Change of Control Redemption”) the Change of Control Redemption Amount at a price in cash equal to (A) in the case of a Change of Control, the product of (i) the Redemption Premium and (ii) the Change of Control Redemption Amount and (B) in the case of a Company Change of Control, 101% of the Change of Control Redemption Amount (the foregoing (A) and (B), the “Change of Control Redemption Price”). If the Holder does not return a Change of Control Redemption Election to the Company by the Change of Control Redemption Election Deadline, none of the Conversion Amount will be redeemed. Redemptions pursuant this Section 4(d) shall be made in accordance with the provisions of Section 10(b) and shall have priority to payments to shareholders in connection with a Change of Control or Company Change of Control, as applicable. Notwithstanding anything to the contrary in this Section 4(d), but subject to Section 3(e), until the Change of Control Redemption Price is paid in full, the Conversion Amount subject to redemption under this Section 4(d) may be converted, in whole or in part, by the Holder into Common Shares pursuant to Section 3(a). Notwithstanding anything to the contrary in this Section 4(d), the Company will not be required to make a Change of Control Offer upon a Change of Control or a Company Change of Control if (i) a Redemption Notice applying to all of the Conversion Amount has been given, unless and until there is a default in payment of the applicable Redemption Price or (ii) in connection with or in contemplation of any Change of Control or Company Change of Control, the Company or a third party has made an offer to purchase (an “Alternate Offer”) any and all Notes validly tendered at a cash price equal to or higher than the Change of Control Redemption Price on terms satisfactory to the Holder and has purchased all Notes properly tendered in accordance with the terms of such Alternate Offer. Notwithstanding anything to the contrary contained herein, a Change of Control Offer or an Alternate Offer may be made in advance of a Change of Control or Company Change of Control, as applicable, or conditioned upon the consummation of such Change of Control or Company Change of Control, if a definitive agreement is in place for the Change of Control or Company Change of Control at the time the Change of Control Offer or Alternate Offer is made. In the event that, upon the consummation of a Change of Control Redemption, Change of Control Offer, Alternate Offer or other tender offer, less than 10% of the aggregate principal amount of the Notes (including, without limitation, any other Notes issued pursuant to the terms of the Transaction Agreement (“Additional Notes”), if any) that were originally issued are outstanding and held by Holders other than the Company or Affiliates thereof, the Company will have the right, upon not less than 10 nor more than 60 days prior notice, to redeem all of the Notes that remain outstanding following such purchase at a redemption price equal to the price offered in such Change of Control Offer, Alternate Offer or other tender offer plus, to the extent not included in such amount, accrued and unpaid interest, if any, on the Notes that remain outstanding, to the date of redemption, subject to the rights of Holders of Notes on the relevant record date to receive interest on the relevant Interest Date.
(5) CONSOLIDATION, MERGER, SALE CONVEYANCE OR SALE; MERGER EVENT; AND CHANGE OF CONTROL.
(a) Company May Consolidate, Etc. on Certain Terms. Unless the Notes are redeemed by the Company in accordance with Section 4(d), the Company shall not consolidate with, merge with or into, or sell, convey, transfer or lease all or substantially all of the consolidated properties and assets of the Company and its Subsidiaries, taken as a whole, to another Person (any such transaction, a “Business Combination”), unless:
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(i) the resulting, surviving or transferee Person (the “Successor Company”), if not the Company, shall be a corporation organized and existing under the laws of Canada, any Province thereof; the United States of America, any State thereof, or the District of Columbia; Luxembourg; the United Kingdom; or any member state of the European Union, and the Successor Company (if not the Company) shall expressly assume in writing all of the obligations of the Company under this Note and the other Transaction Documents to which it is a party; and
(ii) immediately after giving effect to such Business Combination, no Default or Event of Default shall have occurred and be continuing under this Note.
(b) Successor Company to be Substituted. In case of any such Business Combination and upon the assumption by the Successor Company in the manner set forth in Section 5(a)(i), such Successor Company (if not the Company) shall succeed to and, except in the case of a lease, shall be substituted for the Company, with the same effect as if it had been named herein as the party of the first part, and may thereafter exercise every right and power of the Company under this Note. In the event of any such Business Combination (but not in the case of a lease), upon compliance with Section 5(a), the Person named as the “Company” in the first paragraph of this Note may be dissolved, wound up and liquidated at any time thereafter and, except in the case of a lease, such Person shall be released from all of its liabilities and obligations under this Note.
(c) Effect of Recapitalizations, Reclassifications and Changes of the Common Shares. Subject to the rules of the Principal Markets, in the case of:
(i) any recapitalization, reclassification or change of the Common Shares (other than a change to par value, or from par value to no par value, or changes resulting from a subdivision or combination),
(ii) any consolidation, merger, combination or similar transaction involving the Company,
(iii) any sale, lease or other transfer to a third party of the consolidated assets of the Company and the Company’s Subsidiaries substantially as an entirety or
(iv) any statutory share exchange,
in each case, as a result of which the Common Shares would be converted into, or exchanged for, stock, other securities, other property or assets (including cash or any combination thereof) (any such event, a “Merger Event”), then, at the effective time of such Merger Event, the right to convert each $1,000 Conversion Amount of Notes shall be changed into a right to convert such Conversion Amount of Notes into the kind and amount of shares of stock, other securities or other property or assets (including cash or any combination thereof) that a holder of a number of Common Shares equal to the quotient of
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$1,000 and the Conversion Price immediately prior to such Merger Event would have owned or been entitled to receive (the “Reference Property,” with each “Unit of Reference Property” meaning the kind and amount of Reference Property that a holder of one Common Share is entitled to receive) upon such Merger Event and, prior to or at the effective time of such Merger Event, the Company or the successor or purchasing Person, as the case may be, shall agree in writing (a “Merger Event Supplement”) providing for such change in the right to convert this Note.
If the Merger Event causes the Common Shares to be converted into, or exchanged for, the right to receive more than a single type of consideration (determined based in part upon any form of shareholder election), then (i) the Reference Property into which the Notes will be convertible shall be deemed to be the weighted average of the types and amounts of consideration actually received by the holders of Common Shares, and (ii) the unit of Reference Property for purposes of the immediately preceding paragraph shall refer to the consideration referred to in clause (i) attributable to one Common Share. The Company shall notify the Holder of such weighted average as soon as reasonably practicable after such determination is made. Such Merger Event Supplement described in the immediately preceding paragraph shall provide for anti-dilution and other adjustments that shall be as nearly equivalent as is possible to the adjustments provided for in Section 7. If, in the case of any Merger Event, the Reference Property includes shares of stock, securities or other property or assets (including cash or any combination thereof) of a Person other than the successor or purchasing Person, as the case may be, in such Merger Event, then such Merger Event Supplement shall also be executed by such other Person and shall contain such additional provisions to protect the interests of the Holders of the Notes as the Company shall reasonably consider necessary by reason of the foregoing. The Company shall not become party to any Merger Event unless its terms are consistent with this Section 5(c).
(6) WITHHOLDING.
(a) Any and all payments made pursuant to this Note (including, for greater certainty, the issuance of Conversion Shares as provided in Section 3) shall be made without deduction or withholding for any Taxes, except as required by Applicable Law. If any Applicable Law (as determined in the good faith discretion of the Company) requires the deduction or withholding of any Tax from any such payment by the Company to the Holder, then the Company shall be entitled to make such deduction and withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with Applicable Law and, if such Tax is an Indemnified Tax, then the sum payable shall be increased as necessary so that after such deduction or withholding has been made (including such deductions or withholdings of Indemnified Taxes applicable to additional sums payable under this Section 6) the Holder receives an amount equal to the sum it would have received had no such deduction or withholding been made. In addition, the Company agrees to pay to the relevant Governmental Authority in accordance with Applicable Law any present or future stamp, documentary or similar Taxes that arise from any payment made hereunder or in connection with the execution, delivery, registration or performance of, or otherwise with respect to, this Note. The Company shall deliver to the Holder official receipts, if any, in respect of any Taxes payable hereunder promptly after payment of such Taxes or other evidence of payment that is reasonably acceptable to the Holder. The Company shall indemnify the Holder, within ten (10) calendar days after written demand therefor, for the full amount of any Indemnified Taxes, plus any related interest or penalties, that are paid or payable by the Holder to the relevant Governmental Authority.
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(b) If the Holder (including all direct and indirect holders of the Holder) is entitled to an exemption from or reduction of withholding Tax with respect to payments made under this Note, the Holder shall deliver to the Company, at the time or times reasonably requested by the Company, such properly completed and executed documentation reasonably requested by the Company as will permit such payments to be made without withholding or at a reduced rate of withholding (including Canada Revenue Agency NR301, NR302 or NR303 forms and worksheets as required from time to time). In addition, the Holder, if reasonably requested by the Company, shall deliver such other documentation prescribed by Applicable Law or reasonably requested by the Company as will enable the Company to determine whether or not the Holder (including all direct and indirect holders of the Holder) is subject to backup withholding or information reporting requirements or eligible from any other exemption from or reduction of withholding Tax. The Holder agrees that if any documentation it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such documentation or promptly notify the Company in writing of its legal inability to do so.
(c) If the Holder determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which the Company has paid additional amounts pursuant to this Section 6, it shall pay over such refund to the Company (but only to the extent of additional amounts paid by the Company under this Section 6 with respect to the Taxes giving rise to such refund), net of reasonable out-of-pocket expenses and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided, that the Company, upon the request of the Holder, agrees to repay the amount paid over to the Company (plus any penalties, interest, other charges or additional amounts imposed by the relevant Governmental Authority) to the Holder in the event the Holder is required to repay such refund to such Governmental Authority.
(d) The obligations of the Company under this Section 6 shall survive the termination of this Note and the payment of all amounts payable hereunder.
(7) ADJUSTMENTS TO CONVERSION PRICE. The Conversion Price will be subject to adjustment from time to time as provided in this Section 7.
(a) Adjustment of Conversion Price upon Certain Distributions or Events. The Conversion Price shall be adjusted from time to time by the Company if any of the following events occurs on or after the Subscription Date, except that the Company shall not make any adjustments to the Conversion Price if the Holder of this Note participates (other than in the case of (x) a share split or share combination or (y) a tender or exchange offer), at the same time and upon the same terms as holders of the Common Shares and solely as a result of holding this Note, in any of the transactions described in this Section 7(a), without having to convert this Note, as if it held a number of Common Shares equal to the Conversion Amount (expressed in thousands) held by the Holder divided by the applicable Conversion Price.
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(i) If the Company exclusively issues Common Shares as a dividend or distribution on all or substantially all outstanding Common Shares, or if the Company effects a share split or share combination, the Conversion Price shall be adjusted based on the following formula:
where,
| CP0 | = | the Conversion Price in effect immediately prior to the Open of Business on the Ex-Dividend Date of such dividend or distribution, or immediately prior to the Open of Business on the Effective Date of such share split or share combination, as applicable; | ||||
| CP1 | = | the Conversion Price in effect immediately after the Open of Business on such Ex-Dividend Date or Effective Date, as applicable; | ||||
| OS0 | = | the number of Common Shares outstanding immediately prior to the Open of Business on such Ex-Dividend Date or Effective Date, as applicable (before giving effect to any such dividend, distribution, split or combination); and | ||||
| OS1 | = | the number of Common Shares outstanding immediately after giving effect to such dividend, distribution, share split or share combination. | ||||
Any adjustment made under this Section 7(a)(i) shall become effective immediately after the Open of Business on the Ex-Dividend Date for such dividend or distribution, or immediately after the Open of Business on the Effective Date for such share split or share combination, as applicable. If any dividend or distribution of the type described in this Section 7(a)(i) is declared but not so paid or made, the Conversion Price shall be immediately readjusted, effective as of the date the Board of Directors determines not to pay such dividend or distribution, to the Conversion Price that would then be in effect if such dividend or distribution had not been declared.
(ii) If the Company issues to all or substantially all holders of the Common Shares any rights, options or warrants (other than pursuant to a shareholders rights plan) entitling them, for a period of not more than sixty (60) calendar days after the announcement date of such issuance, to subscribe for or purchase Common Shares at a price per share that is less than the average of the Closing Sale Prices of the Common Shares for the ten (10) consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the date of announcement of such issuance, the Conversion Price shall be decreased based on the following formula:
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where,
| CP0 | = | the Conversion Price in effect immediately prior to the Open of Business on the Record Date for such issuance; | ||||
| CP1 | = | the Conversion Price in effect immediately after the Open of Business on the Record Date for such issuance; | ||||
| OS0 | = | the number of Common Shares outstanding immediately prior to the Open of Business on the Record Date for such issuance; | ||||
| X | = | the total number of Common Shares issuable pursuant to such rights, options or warrants; and | ||||
| Y | = | the number of Common Shares equal to the aggregate price payable to exercise such rights, options or warrants, divided by the average of the Closing Sale Price of the Common Shares over the ten (10) consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the date of announcement of the issuance of such rights, options or warrants. | ||||
Any decrease made under this Section 7(a)(ii) shall be made successively whenever any such rights, options or warrants are issued and shall become effective immediately after the Open of Business on the Record Date for such issuance. To the extent that Common Shares are not delivered after the expiration of such rights, options or warrants, the Conversion Price shall be increased to the Conversion Price that would then be in effect had the decrease with respect to the issuance of such rights, options or warrants been made on the basis of delivery of only the number of Common Shares actually delivered. If no such rights, options or warrants are issued, or if no such rights, options or warrants are exercised prior to their expiration, the Conversion Price shall be increased to the Conversion Price that would then be in effect if the Record Date for such issuance had not occurred.
For purposes of this Section 7(a)(ii), in determining whether any rights, options or warrants entitle the holders of Common Shares to subscribe for or purchase Common Shares at a price per share that is less than such average of the Closing Sale Prices of the Common Shares for the ten (10) consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the date of announcement for such issuance, and in determining the aggregate offering price of such Common Shares, there shall be taken into account any consideration received by the Company for such rights, options or warrants and any amount payable on exercise or conversion thereof, the value of such consideration, if other than cash, to be determined by the Company in good faith.
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(iii) If the Company distributes shares of its Equity Interests, evidences of its indebtedness, other assets or property of the Company or rights, options or warrants to acquire its Equity Interests or other securities, to all or substantially all holders of the Common Shares, excluding (i) dividends, distributions or issuances (including share splits) described in Section 7(a)(i) or Section 7(a)(ii), (ii) rights issued under a shareholders rights plan prior to separation thereof from the Common Shares in the circumstances described in Section 7(a)(vii), (iii) dividends or distributions paid exclusively in cash described in Section 7(a)(iv), (iv) Spin-Offs (as defined below) as to which the provisions set forth below in this Section 7(a)(iii) shall apply (any of such shares of Equity Interests, evidences of indebtedness, other assets or property or rights, options or warrants to acquire Equity Interests or other securities, the “Distributed Property”) and (v) a distribution of Reference Property solely pursuant to a Merger Event, as to which Section 5(c) will apply, then the Conversion Price shall be decreased based on the following formula:
where,
| CP0 | = | the Conversion Price in effect immediately prior to the Open of Business on the Record Date for such distribution; | ||||
| CP1 | = | the Conversion Price in effect immediately after the Open of Business on such the Record Date for such issuance; | ||||
| SP0 | = | the average of the Closing Sale Prices of the Common Shares over the ten (10) consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the Record Date for such distribution; and | ||||
| FMV | = | the fair market value (as determined in good faith by the Company) of the Distributed Property with respect to each outstanding Common Share on the Record Date for such distribution. | ||||
Any decrease made under the portion of this Section 7(a)(iii) above shall become effective immediately after the Open of Business on the Record Date for such distribution. If such distribution is not so paid or made, the Conversion Price shall be increased to the Conversion Price that would then be in effect if such distribution had not been declared. Notwithstanding the foregoing, if “FMV” (as defined above) is equal to or greater than “SP0” (as defined above), in lieu of the foregoing decrease, the Holder of this Note shall receive, in respect of such Note, at the same time and upon the same terms as holders of the Common Shares receive the Distributed
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Property, the amount and kind of Distributed Property the Holder would have received if the Holder owned a number of Common Shares equal to the Conversion Amount (expressed in thousands) held by the Holder divided by the applicable Conversion Price in effect on the Record Date for the distribution. If the Board of Directors determines the “FMV” (as defined above) of any distribution for purposes of this Section 7(a)(iii) by reference to the actual or when-issued trading market for any securities, it shall in doing so consider the prices in such market over the same period used in computing the Closing Sale Prices of the Common Shares over the ten (10) consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the Record Date for such distribution.
With respect to an adjustment pursuant to this Section 7(a)(iii) where there has been a payment of a dividend or other distribution on the Common Shares of Equity Interests of any class or series of or relating to a Subsidiary or other business unit of the Company, that are, or, when issued, will be, listed or admitted for trading on a Canadian or U.S. national securities exchange (a “Spin-Off”), the Conversion Price shall be decreased based on the following formula:
where,
| CP0 | = | the Conversion Price in effect immediately prior to the end of the Valuation Period (as defined below); | ||||
| CP1 | = | the Conversion Price in effect immediately after the end of the Valuation Period; | ||||
| FMV0 | = | the average of the Closing Sale Prices of the Equity Interests distributed to holders of the Common Shares applicable to one Common Share (determined by reference to the definition of Closing Sale Price as set forth in Section 32 as if references therein to Common Shares were to such Equity Interests) over the first ten (10) consecutive Trading Day period after, and including, the Ex-Dividend Date of the Spin-Off (the “Valuation Period”); and | ||||
| MP0 | = | the average of the Closing Sale Prices of the Common Shares over the Valuation Period. | ||||
The decrease to the Conversion Price under the preceding paragraph shall occur at the Close of Business on the last Trading Day of the Valuation Period; provided that if the relevant Conversion Date occurs during the Valuation Period, references in the portion of this Section 7(a)(iii) related to Spin-Offs to ten (10) Trading Days shall be deemed to be replaced with such lesser number of Trading Days as have elapsed between, and including, the Ex-Dividend Date of such Spin-Off to, and including, the Conversion Date in
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determining the Conversion Price. If any dividend or distribution that constitutes a Spin-Off is declared by not so paid or made, the Conversion Price shall be immediately increased, effective as of the date the Board of Directors determines not to pay or make such dividend or distribution, to the Conversion Price that would then be in effect if such dividend or distribution had not been declared or announced.
For purposes of this Section 7(a)(iii) (and subject in all respect to Section 7(a)(vii)), rights, options or warrants distributed by the Company to all holders of the Common Shares entitling them to subscribe for or purchase Equity Interests of the Company, including Common Shares (either initially or under certain circumstances), which rights, options or warrants, until the occurrence of a specified event or events (“Trigger Event”): (i) are deemed to be transferred with such Common Shares; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of Common Shares, shall be deemed not to have been distributed for purposes of this Section 7(a)(iii) (and no adjustment to the Conversion Price under this Section 7(a)(iii) will be required) until the occurrence of the earliest Trigger Event, whereupon such rights, options or warrants shall be deemed to have been distributed and an appropriate adjustment (if any is required) to the Conversion Price shall be made under this Section 7(a)(iii). If any such right, option or warrant, including any such existing rights, options or warrants distributed prior to the Subscription Date, are subject to events, upon the occurrence of which such rights, options or warrants become exercisable to purchase different securities, evidences of indebtedness or other assets, then the date of the occurrence of any and each such event shall be deemed to be the date of distribution and Ex-Dividend Date with respect to new rights, options or warrants with such rights (in which case the existing rights, options or warrants shall be deemed to terminate and expire on such date without exercise by any of the holders thereof). In addition, in the event of any distribution (or deemed distribution) of rights, options or warrants, or any Trigger Event or other event (of the type described in the immediately preceding sentence) with respect thereto that was counted for purposes of calculating a distribution amount for which an adjustment to the Conversion Price under this Section 7(a)(iii) was made, (1) in the case of any such rights, options or warrants that shall all have been redeemed or purchased without exercise by any holders thereof, upon such final redemption or purchase (x) the Conversion Price shall be readjusted as if such rights, options or warrants had not been issued and (y) the Conversion Price shall then again be readjusted to give effect to such distribution, deemed distribution or Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share redemption or purchase price received by a holder or holders of Common Shares with respect to such rights, options or warrants (assuming such holder had retained such rights, options or warrants), made to all holders of Common Shares as of the date of such redemption or purchase, and (2) in the case of such rights, options or warrants that shall have expired or been terminated without exercise by any holders thereof, the Conversion Price shall be readjusted as if such rights, options and warrants had not been issued.
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For purposes of Section 7(a)(i), Section 7(a)(ii) and this Section 7(a)(iii), if any dividend or distribution to which this Section 7(a)(iii) is applicable also includes one or both of:
(A) a dividend or distribution of Common Shares to which Section 7(a)(i) is applicable (the “Clause A Distribution”); or
(B) a dividend or distribution of rights, options or warrants to which Section 7(a)(ii) is applicable (the “Clause B Distribution”),
then, in either case, (1) such dividend or distribution, other than the Clause A Distribution and the Clause B Distribution, shall be deemed to be a dividend or distribution to which this Section 7(a)(iii) is applicable (the “Clause C Distribution”) and any Conversion Price adjustment required by this Section 7(a)(iii) with respect to such Clause C Distribution shall then be made, and (2) the Clause A Distribution and Clause B Distribution shall be deemed to immediately follow the Clause C Distribution and any Conversion Price adjustment required by Section 7(a)(i) and Section 7(a)(ii) with respect thereto shall then be made, except that, if determined by the Company (I) the “Ex-Dividend Date” of the Clause A Distribution and the Clause B Distribution shall be deemed to be the Ex-Dividend Date of the Clause C Distribution and (II) any Common Shares included in the Clause A Distribution or Clause B Distribution shall be deemed not to be “outstanding immediately prior to the Open of Business on such Ex-Dividend Date or Effective Date” within the meaning of Section 7(a)(i) or “outstanding immediately prior to the Open of Business on such Ex-Dividend Date” within the meaning of Section 7(a)(ii).
(iv) If any cash dividend or distribution is made to all or substantially all holders of the Common Shares, the Conversion Price shall be adjusted based on the following formula:
where,
| CP0 | = | the Conversion Price in effect immediately prior to the Open of Business on the Ex-Dividend Date for such dividend or distribution; | ||||
| CP1 | = | the Conversion Price in effect immediately after the Open of Business on the Ex-Dividend Date for such dividend or distribution; | ||||
| SP0 | = | the Closing Sale Price of the Common Shares on the Trading Day immediately preceding the Ex-Dividend Date for such dividend or distribution; and | ||||
| C | = | the amount in cash per share the Company distributes to all or substantially all holders of the Common Shares. | ||||
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Any decrease pursuant to this Section 7(a)(iv) shall become effective immediately after the Open of Business on the Ex-Dividend Date for such dividend or distribution. If such dividend or distribution is not so paid, the Conversion Price shall be increased, effective as of the date the Board of Directors determines not to make or pay such dividend or distribution, to be the Conversion Price that would then be in effect if such dividend or distribution had not been declared. Notwithstanding the foregoing, if “C” (as defined above) is equal to or greater than “SP0” (as defined above), in lieu of the foregoing decrease, the Holder of this Note shall receive, in respect of such Note, at the same time and upon the same terms as holders of the Common Shares, the amount of cash that the Holder would have received if the Holder owned a number of Common Shares equal to the Conversion Amount (expressed in thousands) held by the Holder divided by the applicable Conversion Price in effect on the Ex-Dividend Date for such cash dividend or distribution.
(v) If the Company or any of its Subsidiaries make a payment in respect of a tender or exchange offer for the Common Shares that is subject to the then-applicable tender offer rules under the Exchange Act (other than an odd-lot tender offer), to the extent that the cash and value of any other consideration included in the payment per Common Share exceeds the average of the Closing Sale Prices of the Common Shares over the ten (10) consecutive Trading Day period commencing on, and including, the Trading Day next succeeding the last date on which tenders or exchanges may be made pursuant to such tender or exchange offer, the Conversion Price shall be decreased based on the following formula:
where,
| CP0 | = | the Conversion Price in effect immediately prior to the Close of Business on the 10th Trading Day immediately following, and including, the Trading Day next succeeding the date such tender or exchange offer expires; | ||||
| CP1 | = | the Conversion Price in effect immediately after the Close of Business on the 10th Trading Day immediately following, and including, the Trading Day next succeeding the date such tender or exchange offer expires; | ||||
| AC | = | the aggregate value of all cash and any other consideration (as determined by the Company in good faith) paid or payable for Common Shares purchased in such tender or exchange offer; | ||||
| OS0 | = | the number of Common Shares outstanding immediately prior to the date such tender or exchange offer expires (prior to giving effect to the purchase of all Common Shares accepted for purchase or exchange in such tender or exchange offer); | ||||
| OS1 | = | the number of Common Shares outstanding immediately after the date such tender or exchange offer expires (after giving effect to the purchase of all Common Shares accepted for purchase or exchange in such tender or exchange offer); and | ||||
| SP1 | = | the average of the Closing Sale Prices of the Common Shares over the ten (10) consecutive Trading Day period commencing on, and including, the Trading Day next succeeding the date such tender or exchange offer expires. | ||||
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The decrease to the Conversion Price under this Section 7(a)(v) shall occur at the Close of Business on the 10th Trading Day immediately following, and including, the Trading Day next succeeding the date such tender or exchange offer expires; provided that in respect of any conversion of Notes if the relevant Conversion Date occurs during the ten (10) Trading Days immediately following, and including, the Trading Day next succeeding the expiration date of any tender or exchange offer, references in this Section 7(a)(v) with respect to ten (10) Trading Days shall be deemed replaced with such lesser number of Trading Days as have elapsed between the date that such tender or exchange offer expires and the Conversion Date in determining the Conversion Price.
In the event that the Company or one of its Subsidiaries is obligated to purchase Common Shares pursuant to any such tender offer or exchange offer described in this Section 7(a)(v) but the Company or such Subsidiary is permanently prevented by applicable law from effecting any such purchase or any such purchase is rescinded, the applicable Conversion Price shall be readjusted to be the Conversion Price that would then be in effect if such tender or exchange offer had not been made or had been made only in respect of the purchases that have been effected.
(vi) For purposes of this Section 7(a), the number of Common Shares at any time outstanding shall not include Common Shares held in the treasury of the Company so long as the Company does not pay any dividend or make any distribution on the Common Shares held in the treasury of the Company, but shall include Common Shares issuable in respect of scrip certificates issued in lieu of fractions of Common Shares.
(vii) If the Company has a shareholder rights plan in effect upon conversion of this Note, each Common Share, if any, issued upon such conversion shall be entitled to receive the appropriate number of rights, if any, and the certificates representing Common Shares issued upon such conversion shall bear such legends, if any, in each case as may be provided by the terms of any such shareholder rights plan, as the same may be amended from time to time. However, if, prior to any conversion of this Note, the rights have separated from the Common Shares in accordance with the provisions of the applicable shareholder rights plan, the Conversion Price shall be adjusted at the time of separation as if the Company distributed to all or substantially all holders of the Common Shares Distributed Property as provided in Section 7(a)(iii), subject to readjustment in the event of the expiration, termination or redemption of such rights.
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(viii) Notwithstanding this Section 7(a) or any other provision of this Note, if a Conversion Price adjustment becomes effective on any Ex-Dividend Date, and a Holder that has converted its Notes on or after such Ex-Dividend Date and on or prior to the related record date of such dividend, distribution or other transaction would be treated as the record holder of Common Shares as of the related Conversion Date based on an adjusted Conversion Price for such Ex-Dividend Date, then, notwithstanding the Conversion Price adjustment provisions in this Section 7(a), the Conversion Price adjustment relating to such Ex-Dividend Date shall not be made for such converting Holder. Instead, such Holder shall be treated as if such Holder were the record owner of the Common Shares on an unadjusted basis and participate in the related dividend, distribution or other event giving rise to such adjustment.
(ix) Except as stated herein, the Company shall not adjust the Conversion Price for the issuance of Common Shares or any Equity Interests of the Company or any of its Subsidiaries convertible into or exchangeable for Common Shares or the right to purchase Common Shares or such convertible or exchangeable Equity Interests.
(x) Except as described in this Section 7(a), the Conversion Price shall not be required to be adjusted for any transaction or event. Without limiting the foregoing, the Conversion Price shall not be required to be adjusted:
(A) upon the issuance of Common Shares at a price below the Conversion Price or otherwise, other than any such issuance described in Sections 7(a)(i) – (iii);
(B) upon the issuance of any Common Shares pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on the Company’s securities and the investment of additional optional amounts in Common Shares under any plan;
(C) upon the issuance of any Common Shares or options or rights to purchase those shares pursuant to any present or future employee, director or consultant benefit or incentive plan or program of or assumed by the Company or any of the Company’s Subsidiaries;
(D) upon the issuance of any Common Shares pursuant to any option, warrant, right or exercisable, exchangeable or convertible security not described in clause (C) of this subsection and outstanding as of the date the Notes were first issued;
(E) for a third-party tender offer other than as described in Section 7(a)(v);
(F) solely for a change in the par value of the Common Shares;
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(G) upon the repurchase of any Common Shares pursuant to an open market share repurchase program or other buy-back transaction, including structured or derivative transactions such as accelerated share repurchase transactions or similar forward derivatives, or other buy-back transaction, that is not a tender offer or exchange offer of the kind described in Section 7(a)(v); or
(H) for accrued and unpaid interest, if any.
(xi) All calculations and other determinations under this Section 7 shall be made by the Company and shall be made to the nearest one-ten thousandth (1/10,000th) of a U.S. dollar. The Company shall not be required to make an adjustment in the Conversion Price unless the adjustment would require a change of at least 1% in the Conversion Price. However, the Company shall carry forward any adjustments that are less than 1% of the Conversion Price and make such carried forward adjustments (1) upon conversion of any Note, on the relevant Conversion Date, (2) in determining consideration due on any Redemption Date and (3) on each anniversary of the original issue date of the Notes, in each case, without duplication and regardless of whether the aggregate adjustment is less than 1%.
(b) Voluntary Adjustment by Company. Subject to the rules of the Principal Markets, the Company may at any time during the term of this Note, with the prior written consent of the Required Holders, reduce the then current Conversion Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.
(8) NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its Notice of Articles or Articles through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will at all times in good faith carry out all of the provisions of this Note and take all action as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing or any other provision of this Note or the other Transaction Documents, the Company (i) shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Common Shares upon the conversion of this Note and (ii) shall, so long as any of the Notes are outstanding, take all action necessary to reserve and keep the applicable Required Reserve Amount (as defined below) available out of its authorized and unissued Common Shares, solely for the purpose of effecting the conversion of the Notes (without regard to any limitations on conversion).
(9) RESERVATION OF AUTHORIZED SHARES. The Company shall reserve such number of Common Shares for this Note sufficient to effect the conversion of all of the outstanding and unpaid Conversion Amount of this Note from time to time (the “Required Reserve Amount”). So long as this Note is outstanding, the Company shall take all corporate action necessary to reserve and keep available out of its authorized and unissued Common Shares, solely for the purpose of effecting the conversion of this Note, the number of Common Shares equal to the applicable Required Reserve Amount.
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(10) REDEMPTIONS.
(a) Company Redemption Right. In the event that (i) the Closing Sale Price of the Company’s Common Shares during any consecutive thirty (30) Business Day period is at least 185% of the Conversion Price and (ii) thirty (30) months have elapsed from the Subscription Date, the Company may, at its option, redeem (a “Company Redemption”) all or any portion of this Note by delivering written notice thereof (a “Company Redemption Notice”) to the Holder specifying the portion of the Conversion Amount the Company is electing to redeem (the “Company Redemption Amount”). No less than ten (10) nor greater than sixty (60) days after the Company Redemption Notice is delivered to the Holder (the “Company Redemption Date”), the Company shall redeem the Company Redemption Amount at a price equal to the Conversion Amount (the “Company Redemption Price”). Redemptions pursuant to this Section 10(a) shall be made in accordance with Section 10(b).
(b) Redemption Mechanics. On the Change of Control Redemption Date, the Company shall deliver the applicable Change of Control Redemption Price to the Holder, except to the extent of any Conversion Amount of this Note that was submitted for conversion into Common Shares by the Holder pursuant to Section 3(a). On the Company Redemption Date, the Company shall deliver the Company Redemption Price to the Holder, except to the extent of any Conversion Amount of this Note that was submitted for conversion into Common Shares by the Holder pursuant to Section 3(a). In either case, the Company shall pay the applicable Redemption Price to the Holder in cash by wire transfer of immediately available funds pursuant to wire instructions provided by the Holder in writing to the Company on the applicable due date. In the event of a redemption of less than all of the Conversion Amount of this Note, the Company shall promptly cause to be issued and delivered to the Holder a new Note (in accordance with Section 19(d)) representing the outstanding Principal which has not been redeemed and any accrued Interest on such Principal which shall be calculated as if no Redemption Notice has been delivered. In the event that the Company does not pay a Redemption Price to the Holder within the time period required, at any time thereafter and until the Company pays such unpaid Redemption Price in full, the Holder shall have the option, in lieu of redemption, to require the Company to promptly return to the Holder all or any portion of this Note representing the Conversion Amount that was submitted for or subject to redemption and for which the applicable Redemption Price has not been paid. Upon the Company’s receipt of such notice, (x) the applicable Redemption Notice shall be null and void with respect to such Conversion Amount and (y) the Company shall immediately return this Note, or issue a new Note (in accordance with Section 19(d)) to the Holder representing such Conversion Amount to be redeemed.
(11) VOTING RIGHTS. The Holder shall have no voting rights in respect of any Conversion Share until the Conversion Date in respect of such Conversion Share, except as required by law and as expressly provided in this Note.
(12) RANK. This Note ranks pari passu in right of payment to all outstanding and future senior Indebtedness of the Company.
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(13) NEGATIVE COVENANTS. Until all of the Notes have been converted, redeemed or otherwise satisfied in full in accordance with their terms, the Company shall not, and the Company shall not permit any of the Intermediate Holding Companies, Project Holdco or the Project Company, as applicable, to, without the prior written consent of the Required Holders, directly or indirectly:
(a) engage in any business other than the acquisition, ownership, design, development, construction, financing, implementation, completion, operation and maintenance of the Project (including, for the avoidance of doubt, Phase Two thereof) and activities directly redirected thereto in accordance with and as contemplated by the Transaction Documents, the DOE Financing Documents and the GM Investment Documents;
(b) fail to maintain its existence and its right to carry on its business;
(c) directly or indirectly incur, create, guarantee, assume, permit to exist or otherwise become liable for any Indebtedness, except for Permitted Company Indebtedness or Permitted Project Indebtedness;
(d) create, assume or otherwise permit to exist any Lien upon any of its property, whether now owned or hereafter acquired, or in any proceeds or income therefrom, other than Permitted Company Liens or Permitted Project Liens;
(e) purchase, hold or acquire (including pursuant to any merger with any Person that is not the Company or was not a Wholly-Owned Subsidiary prior to such merger) any Indebtedness or Equity Interests (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, Guarantee any obligations of, or make or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit (whether through purchase of assets, merger or otherwise), other than Permitted Company Investments or Permitted Project Investments;
(f) [Reserved];
(g) declare or make, or agree to declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except (i) the Company may declare and pay dividends with respect to its Common Shares payable solely in additional Common Shares, and, with respect to its preferred stock, payable solely in additional shares of such preferred stock or in Common Shares, (ii) Subsidiaries may declare and pay dividends ratably with respect to their Equity Interests, (iii) the Company may make Restricted Payments to pay for the repurchase, redemption, retirement or other acquisition of Equity Interests of the Company held by any future, present or former employee, director, officer, manager or consultant of the Company or any of its subsidiaries pursuant to any bona fide management, director, employee and/or advisor equity plan or equity option plan or any other bona fide management, director, employee and/or advisor benefit plan or agreement approved by the Board of Directors or any bona fide equity subscription or equityholder agreement approved by the Board of Directors or any bona fide termination agreement or any similar agreement or arrangement, including any Equity Interests rolled over by management, directors or employees of the Company or any of its subsidiaries in connection with any corporate transaction; (iv) the Company may make
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purchase, repurchase, redemption, retirement, acquisition, cancellation, termination of, or payment on, Equity Interests deemed to occur on the exercise of options by the delivery of Equity Interests in satisfaction of the exercise price of such options or in connection with paying cash in lieu of fractional shares or payments or distributions to dissenting shareholders pursuant to applicable law in connection with a share dividend, distribution, share split, reverse share split, merger, consolidation, amalgamation or other business combination of the Company; (v) the Company or any Subsidiary may make payments made or expected to be made (including repurchases of Equity Interests) in respect of withholding or similar taxes payable in connection with the exercise or vesting of Equity Interests or any other equity award by any future, present or former employee, director, officer, manager, contractor, consultant or advisor (or their respective controlled Affiliates or immediate family members) of the Company or any of its subsidiaries and purchases, repurchases, redemptions, defeasances or other acquisitions or retirements of Equity Interests deemed to occur upon the exercise, conversion or exchange of stock options, warrants, equity-based awards or other rights in respect thereof if such Equity Interests represent a portion of the exercise price thereof or payments in lieu of the issuance of fractional securities or in respect of withholding or similar taxes payable upon exercise or vesting thereof; (vi) Project Holdco may make redemptions with respect to its Members (as defined in the LAC-GM JV LLCA) under the LAC-GM JV LLCA, the Affiliates of such Members and any permitted transferees of GM’s Units (as defined in the LAC-GM JV LLCA), in each case, in compliance with the terms of the LAC-GM JV LLCA; and (vii) Permitted Debt Payments;
(h) except as permitted by Section 5(a) and without limiting Section 15(b), merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or otherwise Dispose of all or substantially all of its assets (except for Permitted Dispositions or as permitted by Section 13(h), provided in each case that no Default or Event of Default has occurred and is continuing or would result therefrom), or all or substantially all of the stock of any of its Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate, wind up or dissolve; provided that, (x) if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing, (i) any Subsidiary of the Company may merge into the Company in a transaction in which the Company is the surviving entity and (ii) any Subsidiary may merge into any other Subsidiary in a transaction in which the surviving entity is a Subsidiary; provided further that any such merger involving a Person that is not a Wholly-Owned Subsidiary immediately prior to such merger shall not be permitted unless (x) such merger is also a Permitted Company Investment, (y) if such merger, consolidation, Disposition, liquidation or dissolution, as the case may be, constitutes a Change of Control or Company Change of Control, it shall be permitted if the Change of Control Redemption Price is paid in accordance with Sections 4(d) and 10 or (z) if such merger is required by the GM Investment Documents;
(i) sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) transactions that are at prices and on terms and conditions not less favorable to the Company or such Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties, which, for the avoidance of doubt shall include any transaction between the Company and its Subsidiaries which is in compliance with relevant transfer pricing regulations and in respect of the Management Services Agreement, (b) transactions
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between or among any Subsidiary and any other Subsidiary, to the extent not involving any other Affiliate, (c) any investment permitted by clause (vi), (vii), (viii), (ix), (x), (xi), (xv), (xvii) or (xix) of the definition of Permitted Company Investment, (d) any Indebtedness permitted under clause (iii) or (xv) of the definition of Permitted Company Indebtedness, (e) any Restricted Payment permitted by Section 13(e), (f) loans or advances to employees which constitute Permitted Company Investments, (g) the payment of reasonable fees to directors of the Company or any Subsidiary who are not employees of the Company or such Subsidiary, and severance, compensation and employee benefit arrangements paid to, and indemnities provided for the benefit of, directors, officers or employees of the Company or their Subsidiaries in the ordinary course of business, (h) Permitted Intercompany Activities, (i) any issuances of securities or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment agreements, stock options and stock ownership plans approved by the Board of Directors and (j) any sale or transfer of any tax credits; provided that the Company or such Subsidiary may Guarantee an indemnity for losses from the sale or transfer of Specified Tax Credits on commercially reasonable terms and conditions, but if the guarantee amount exceeds the Company’s share of the liability, based on its direct or indirect ownership percentage of the Project Company at the time such Guarantee is provided, such excess portion must not exceed $38,000,000;
(j) in the case of each Intermediate Holding Company, issue, sell or grant, or permit the Project Holdco to issue, sell or grant, any shares of its capital stock or other equity or voting interests, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock or other equity or voting interests, or any rights, warrants or options to purchase any shares of its capital stock or other equity or voting interests, except (i) any issuance to the Company and its Wholly-Owned Subsidiaries and (ii) the issuance of Common Equity of the Project Holdco pursuant to and in accordance with the LAC-GM JV LLCA, including as a result of the application of Section 9.1(a) of the LAC-GM JV LLCA;
(k) amend, modify or waive any of its rights under its Notice of Articles or Articles or other organizational or governing documents, to the extent any such amendment, modification or waiver would be adverse to the Holder;
(l) enter into any agreement or arrangement or take any action which restricts or purports to restrict the ability of (i) the Company or any Subsidiary to pay dividends or make any other distributions to the Company or any other Subsidiary or repay Indebtedness owing to the Company or any other Subsidiary, or (ii) the Company to perform its other obligations under this Note; provided, that, nothing in this clause (l) shall restrict (1) the DOE Financing Documents, the GM Investment Documents or the Affiliate Support Agreement (as such foregoing agreements exist as at the date hereof), (2) compliance with any Applicable Laws or (3) agreements governing Indebtedness incurred pursuant to clause (xiv) of Permitted Project Indebtedness; provided such agreements do not restrict or purport to restrict the ability of the Company or any Subsidiary to make payments owing under or pursuant to this Note or the Production Payment Agreement;
(m) enter into any Hedging Agreements;
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(n) change its fiscal year;
(o) amend or modify its accounting policies or reporting practices other than as required by GAAP, IFRS or other applicable and appropriate generally accepted accounting principles to which the Company is subject and that may be applicable thereto from time to time;
(p) agree or consent to any amendments, modifications or replacements to the DOE Financing Documents or the GM Investment Documents in a manner that is materially adverse to the Holder;
(q) make any material changes, amendments, modifications or replacements to the Mine Plan or Construction Budget unless: (i) during the term of the DOE Loan and provided independent third Persons are actively engaged under the DOE Loan, the Mine Plan receives the approval of the applicable independent third Persons that are required to approve changes to the Mine Plan under the DOE Loan, and (ii) after the term of the DOE Loan or if the DOE Loan is otherwise terminated or if no independent third Persons are actively engaged under the DOE Loan, an independent third party consultant acceptable to the Required Holders confirms in writing to the Company that such proposed changes will not result in the Company and its Subsidiaries having insufficient funds to complete the Project in accordance with the revised Mine Plan; or
(r) except (i) as permitted by Sections (13)(h), (13)(i), and (15)(b) and (ii) any sale or transfer of any tax credits and provided that no Default or Event of Default has occurred and is continuing or is reasonably expected to result therefrom, dispose any of its assets or properties except to the extent that the proceeds of such dispositions are (a) applied to prepay Indebtedness outstanding under the DOE Loan and/or (b) fully reinvested in the business of the Company within six (6) months following the date of receipt of such proceeds.
(14) AFFIRMATIVE COVENANTS. Until all of the Notes have been converted, redeemed or otherwise satisfied in full in accordance with their terms, the Company shall, and the Company shall cause each Intermediate Holding Company, Project Holdco and the Project Company to, as applicable, unless otherwise agreed to by the Required Holders, directly and indirectly:
(a) Existence; Conduct of Business. Preserve and maintain (i) its legal existence and (ii) all of its licenses, rights, privileges and franchises, in each case, that are material to the conduct of its business and the Project.
(b) Compliance with Laws and Major Project Document Obligations. (a) Comply with Applicable Laws applicable to it or its property and (b) perform in all material respects its obligations under Major Project Documents, except, in each case, where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
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(c) Use of Proceeds. The proceeds of the Note will be used only to fund, directly or indirectly, the Company’s proportionate share of the development, construction and working capital costs of the Project and general corporate and administrative needs and expenses of the Company and its subsidiaries in connection therewith, and not in contravention of any Applicable Laws, Transaction Documents or Governmental Approvals.
(d) Further Assurances. Upon the reasonable request of the Holder, promptly execute and deliver such further instruments and do or cause to be done such further acts as may be necessary or advisable to (i) carry out the intent and purposes of this Note and the other Transaction Documents or (ii) correct any material defect or error that may be discovered in any Transaction Document or in the execution, acknowledgement, filing, or recordation thereof.
(e) Notices.
(i) Promptly, but in any event within five (5) Business Days of the Company or obtaining knowledge thereof, notify the Holder in writing whenever an Event of Default (an “Event of Default Notice”) occurred, which notice under this clause (e)(i) shall be accompanied by a statement of a financial officer or other executive officer of the Company setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
(ii) Promptly notify the Holder of the occurrence of:
(A) any material default by any party under or termination or threatened termination of any Major Project Document, of which it becomes aware;
(B) the loss of or material non-compliance with the terms of, or any threat (whether or not in writing) by a Governmental Authority to revoke or suspend, any Required Project Approvals; or
(C) any non-compliance by any Group Member with the HSEC Policy in any material respect, or by any Group Member with the Anti-Corruption Policy in any material respect.
(f) Certain Information. Promptly following any reasonable request therefor by the Holder, provide to the Holder (i) such other information regarding the operations, material changes in ownership of Equity Interests, business affairs and financial condition of the Company or any Intermediate Holding Company, or compliance with the terms of this Note, as the Holder may reasonably request, and (ii) information and documentation reasonably requested by the Holder for purposes of compliance with applicable “know your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act and the Beneficial Ownership Regulation.
(g) Insurance. Obtain, maintain and comply with (or cause to be obtained, maintained and complied with) insurance policies on the Project Property in amounts and against losses or damages, including property damage and public liability, on a basis consistent with insurance obtained by reasonably prudent participants in comparable businesses in the relevant jurisdictions.
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(h) Sanctions. Comply with all applicable requirements of all Anti-Corruption Laws, Anti-Money Laundering Laws and all Sanctions, and maintain proper operating and credit policies and procedures (including, “know your customer” and anti-money laundering policies) to ensure, inter alia, proper credit, risk and conflicts of interest management in connection therewith.
(i) Anti-Corruption Policy. In the case of the Company, at all times comply with the Anti-Corruption Policy, and shall immediately notify the Holder upon becoming aware of any breach or suspected breach of the Anti-Corruption Policy. The Company shall not, without the prior written consent of the Holder, acting reasonably, amend, terminate, replace or otherwise vary the Anti-Corruption Policy.
(j) Taxes. File all material tax returns required by Applicable Law to be filed by the Company (subject to applicable extensions) and pay or cause to be paid on or before the date payment is due (i) all income taxes that are shown to have become due pursuant to such tax returns and (ii) all other material taxes and assessments required to be paid by it, except, in each case taxes and assessments it contests in good faith by appropriate legal proceedings.
(k) Bankruptcy Remoteness. Ensure that the Project Company remains a bankruptcy-remote, single-purpose entity at all times and shall do all things necessary to maintain its corporate existence separate and apart from any other Group Member.
(l) Environmental Notices. To the extent provided to the DOE (or a replacement lender if the DOE Loan is replaced or otherwise refinanced), promptly notify the Holder, including in the notification the intended action to be taken by them, upon:
(i) any material claim, complaint, notice or order under any Environmental Laws affecting any Project Entity or any Project;
(ii) any written formal or informal material environmental notices, orders, decisions, directives or determinations submitted by any Governmental Authority to the Company or the Project Company, including any violations of Environmental Law identified in writing by such Governmental Authority together with a report setting out remedial action or proposed remedial action taken with respect thereto;
(iii) any accident or event related to the Project having a material and adverse impact on the environment or on human health (including any such accident or event resulting in a serious injury or the loss of life), any discovery of the presence of Hazardous Substances at the Project Site, or Release or threatened Release under, at or through the Project Site required to be reported to any federal, state or local Governmental Authority under any applicable Environmental Law;
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(iv) the occurrence of any change in business activity conducted by it which involves the storage, use or handling of Hazardous Substances or wastes or increases its environmental liability in any material manner; and
(v) any proposed change in the use or occupation of the Project Real Property which may have a material impact on the Project Entities’ ability to carry on the Business and to develop and operate the Project.
(m) Other Notices.
(i) Promptly notify the Holder of (a) any new Major Project Documents or any amendment or revision to any existing Major Project Document, and (b) any new Required Project Approvals or any amendment, revision, reissuance or replacement of any existing Required Project Approval, and in the case of both clauses (a) and (b) above, forthwith provide a true and complete copy of the same to the Holder in accordance with Section 14(l);
(ii) promptly notify the Holder of any material updates to, and deliver to the Holder revised versions of, the Construction Budget, the Integrated Project Schedule, the Mine Plan, and the Operating Plan and the O&M Budget as specified therein;
(iii) to the extent not publicly available, reasonably promptly following a request thereof from the Holder, the Company shall cause the Project Company to provide any financial information, financial statements, budgets, forecasts, projections, lists of property and accounts and other statements as the Holder may reasonably request from time to time; and
(iv) provide the Holder with copies of any notices or other information and documentation delivered to the DOE pursuant to Sections 8.03 and 8.04 of the DOE Loan (or the similar sections in respect of a replacement lender if the DOE Loan is replaced or otherwise refinanced).
(n) DOE Notices. Promptly provide any material reports, certificates, documents and notices relating to the Project which are delivered to any Group Member by or on behalf of any third-party consultant or contractor, to the extent provided to the DOE (or a replacement lender if the DOE Loan is replaced or otherwise refinanced).
(o) Major Project Documents, Required Project Approvals and Mine Plan. To the extent not otherwise provided pursuant to Section (14)(n), promptly deliver or furnish, or cause to be delivered or furnished, to the Holder a copy of:
(i) any new Major Project Document or any amendment or revision to any existing Major Project Document;
(ii) any new Required Project Approval or any amendment, revision, reissuance or replacement of any existing Required Project Approval;
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(iii) any new technical reports or updated mineral reserve and mineral resource estimates produced that pertain to the Project Real Property, or any material engineering or technical studies relating to the Project; and
(p) Reporting.
(i) Monthly Reporting. Within 10 (ten) Business Days of the after the end of each calendar month, the Company shall deliver to the Holder, a Monthly Operations Report (following the Phase One Effective Date) or a Monthly Construction Report (prior to the Phase One Effective Date).
(ii) Quarterly Reporting.
(A) Within twenty-one (21) Business Days after the end of each fiscal quarter of each fiscal year, the Company shall deliver to the Holder a Quarterly Operations Report (following the Phase One Effective Date) or a Quarterly Construction Report (prior to the Phase One Effective Date);
(B) within the time periods specified in the SEC’s rules and regulations applicable to a non-accelerated filer, after giving effect to all applicable extensions and cure periods, the Company shall deliver to the Holder unaudited consolidated financial statements (making of such documents publicly available on the Company’s SEDAR+ and/or EDGAR profile satisfies the delivery requirements); and
(C) within sixty (60) days after the end of each Fiscal Quarter as it relates to all Fiscal Quarters other than the Fiscal Quarter ended December 31, and within ninety (90) days for the Fiscal Quarter ended December 31, of each Fiscal Year, the Company shall deliver to the Holder a Compliance Certificate.
(iii) Annual Reporting. Within the time periods specified in the SEC’s rules and regulations applicable to a non-accelerated filer, after giving effect to all applicable extensions and cure periods, the Company shall deliver to the Holder audited consolidated financial statements (making of such document publicly available on the Company’s SEDAR+ and/or EDGAR profile satisfies the delivery requirements).
(15) ADDITIONAL PROJECT NEGATIVE COVENANTS. Until all of the Notes have been converted, redeemed or otherwise satisfied in full in accordance with their terms, the Company shall not permit the Project Company to, without the prior written consent of the Required Holders, directly or indirectly:
(a) Restrictions on Operations.
(i) Undertake any action that could reasonably be expected to lead to a material alteration of the nature of its business or the nature or scope of the Project (including any expansion thereof), except as contemplated in DOE Financing Documents and the GM Investment Documents and that could not reasonably be expected to have a Material Adverse Effect; or
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(ii) enter into any partnership, profit-sharing or royalty streaming agreement (other than the Production Payment Agreement) or other similar arrangement whereby the Project Company’s income or profits are, or might be, shared with any other Person, except as permitted by the Transaction Documents, the DOE Financing Documents and the GM Investment Documents.
(b) Merger; Disposition; Transfer.
(i) Other than any Permitted Dispositions, provided that no Default or Event of Default has occurred and is continuing or would result therefrom, enter into any transaction of merger, consolidation, liquidation, winding up or dissolution; or
(ii) other than any Permitted Dispositions, provided that no Default or Event of Default has occurred and is continuing or would result therefrom, carry out any sale, lease (as lessor), transfer or other disposition of all or any part of its ownership interests in the Project or any other part of its business or property of any kind whatsoever (other than the transfer or disposition of any tax credits), whether real, personal or mixed and whether tangible or intangible, whether now or hereafter acquired.
(c) Subsidiaries.
(i) Acquire any Equity Interests in or make any capital contribution to any other Person; or
(ii) enter into any management contract or similar arrangement whereby its business or operations are managed by any other Person.
(16) ADDITIONAL PROJECT AFFIRMATIVE COVENANTS. Until all of the Notes have been converted, redeemed or otherwise satisfied in full in accordance with their terms, the Company shall cause the Project Company to, unless otherwise agreed to by the Required Holder, directly and indirectly:
(a) Maintenance of Property; Project Mining Claims; Etc.
(i) Keep (or cause to be kept) all its properties in good working order and condition to the extent necessary subject to reasonable wear and tear to ensure that its business can be conducted properly and continuously and in material compliance with all Applicable Laws, Required Project Approvals and its Notice of Articles or Articles or other organizational documents at all times;
(ii) Maintain the Project Mining Claims in good standing in material compliance with all Applicable Laws, including payment of all fees and assessments corresponding to the Project Mining Claims and make all filings or recordings required under Applicable Laws. The Project Company shall also keep in good order the data related to the Project Mining Claims. Such data shall include surveys, maps, plans, specifications, drill core samples, assays, books, records, studies, assessments, models, interpretations and copies of drill logs, reports or other information of any kind and in any format (including in electronic format) relating to the Project Mining Claims;
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(iii) Preserve and maintain good and marketable title to or leasehold interest in or unpatented mining claim rights and such water rights and other rights to use the Project Site as are necessary to construct, operate and maintain the Project in accordance with the requirements of the DOE Financing Documents, the Major Project Documents and the Integrated Project Schedule, and shall, at its own expense, take all actions to ensure that it has sufficient title and rights to the Project Site as are necessary for the development, construction, operation and maintenance of the Project as contemplated by such Transaction Documents;
(iv) Warrant and defend the right, title and interest of the Project Entities in and to any of the Project Property, and every part thereof, against the claims of any Person, subject only to Permitted Liens; and
(v) Maintain the Project Real Property in good standing, performing or causing to be performed all required assessment work thereon, paying or causing to be paid all concession, permit and license maintenances fees in respect thereof, paying or causing to be paid all rents and other payments in respect of leased properties forming a part thereof and otherwise maintaining the Project Real Property in compliance, in all material respects, with Applicable Law.
(b) Compliance with Applicable Laws; Required Project Approvals.
(i) Comply with, and conduct its business, operations, assets, equipment, property, leaseholds, and other facilities (including the Project), subject to clause (ii) below, in all material respects in compliance with all Environmental Laws, all Required Project Approvals and all other Applicable Laws; and
(ii) Procure all Required Project Approvals at or prior to such time as they are required or necessary and maintain such Required Project Approvals.
(c) Operating Plan; Operations.
(i) Cause the Project, or such portions of the Project that have begun commercial operations, to operate in all material respects pursuant to the Operating Plan then in effect;
(ii) Conduct the operations of the Project in accordance, in all material respects, with the DOE Financing Documents (including in accordance with the Operating Plan, the Mine Plan and the O&M Budget as specified therein), the Major Project Documents, Applicable Law, any applicable Required Project Approvals and Prudent Industry Practice; and
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(iii) Own, maintain, repair and replace (or cause to be owned, maintained, repaired and replaced) all equipment, spare parts, and inventory reasonably necessary for the operation and maintenance of the Project in all material respects in accordance with the DOE Financing Documents (including in accordance with the Operating Plan, Mine Plan and O&M Budget as specified therein), the Major Project Documents, Applicable Law, any other applicable Required Project Approvals and Prudent Industry Practice.
(d) Access to the Project; Inspection. With ten (10) Business Days’ prior written notice during reasonable business hours, and with five (5) Business Days’ notice during reasonable business hours if an Event of Default shall have occurred and be continuing, and subject to: (i) compliance with all applicable Project Site safety requirements and policies; and (ii) the Project Company’s right, acting reasonably, to coordinate such access to the Project Site with other consultants, contractors, representatives and officers of the DOE, provide the Holder’s officers, representatives, its Independent Engineer and Independent Environmental and Social Consultant with (a) access to any pertinent books, documents, papers and records of the Company and its Subsidiaries for the purpose of audit, examination, inspection and monitoring, to examine and discuss the affairs, finances and accounts of the Company and its Subsidiaries with the representatives of the Company and its Subsidiaries, (b) access to the Project Site and ancillary facilities (and allowing the officers and designated representatives of the Holder to discuss the Company’s and its Subsidiaries’ affairs, finances and accounts with the Company’s and its Subsidiaries’ respective officers) for the purpose of monitoring the performance of the Project and (c) such other access rights to visit and inspect the Project and any other facilities and properties of the Company; in each case limited to (y) prior to the Project Completion Date, once per fiscal quarter, and (z) after the Project Completion Date, once per six (6) month period. The Company shall be responsible for all reasonable and documented fees, costs and expenses incurred by the Holder in connection with such site visits (including all reasonable and documented fees, costs and expenses of the Independent Engineer and Independent Environmental and Social Consultant) up to a maximum of $[***] per Calendar Year, provided that such cap shall not apply if an Event of Default has occurred and is continuing.
(e) Environmental and Social Matters.
(i) IRMA.
(A) The lithium material mined and supplied from the Project will be sourced in a responsible and ethical manner. The Company and its Subsidiaries will undergo a third party Environmental Social, and Governance independent assessment of the Project pursuant to the Initiative for Responsible Mining Assurance (“IRMA”) Standard for Responsible Mining.
(B) The Company shall:
(1) complete an IRMA-approved independent third-party audit of the Project Site (the “IRMA Audit”) within eighteen (18) months of the Phase Two Effective Date (as defined in the JV Investment Agreement in effect as of the date hereof);
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(2) provide the Holder with (i) reasonably detailed monthly updates on the IRMA Audit progress as part of the reporting required under Section 14(m)(i) and (b) a copy of the final IRMA Audit report promptly upon its completion;
(3) develop an IRMA action plan (the “IRMA Action Plan”) in collaboration with GM, as per the JV Investment Agreement, to address any critical requirements not fully met during the IRMA Audit. This plan shall include a timeline and action plan for resolving identified deficiencies and the Company shall provide the Holder with a copy of such plan;
(4) (i) engage in reasonable consultation with the Holder regarding the IRMA Audit findings, (ii) provide the Holder with the opportunity to submit proposals and suggestions concerning the IRMA Audit findings and the IRMA Action Plan. The Company shall: (a) give due consideration to implementing these proposals and (b) provide feedback to the Holder on the feasibility and potential implementation of their suggestions;
(5) work diligently and in good faith to (a) adhere to the IRMA Action Plan and (b) maintain ongoing compliance with IRMA Standard for Responsible Mining; and
(6) promptly furnish the Holder with all corresponding reporting generated to meet the IRMA Standard for Responsible Mining.
(ii) CDA and Other.
(A) Prior to the Phase One Effective Date, the Company shall (i) ensure that the Tailings Facility has been designed, constructed, and maintained to the standard set out in the technical reports prepared in compliance with National Instrument 43-101 and SK-1300 and in accordance with the Canadian Dam Association (CDA) Standards, where GISTM is an acceptable substitute, (ii) promptly appoint and engage individuals to meet the chosen tailings standard, (iii) promptly provide to the Holder corresponding reporting generated to meet such standard.
(B) The Company covenants and agrees that it shall comply and shall ensure that all operations in respect of the Project, as applicable, comply with: (i) all applicable Environmental Laws, including all material Governmental Approvals, in each case then applicable; (ii) all other Environmental and Social Requirements in all material respects; and
(C) The Company covenants and agrees to implement procedures to monitor compliance by it and its Subsidiaries with, and prevent material liability under, the Environmental and Social Requirements.
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(f) Technical Committee. For so long as the OMF Fund IV SPV M LLC (or an Affiliate thereof) continues to hold fifty percent (50%) or more of the outstanding Principal of the Notes,
(i) Responsibilities of Technical Committee. The mandate of the Technical Committee shall include all technical, design, environmental, social, governance and operational aspects of the Project and the Technical Committee shall provide information to the Company and the Holder with respect to all such matters.
(ii) Establishment and Maintenance of Technical Committee.
(A) From and after the date of this Note, the Technical Committee shall be established maintained by the Company to monitor the development and construction of the Project until the Project Completion Date.
(B) In carrying out its responsibilities, the Technical Committee shall coordinate and consult with the Company’s management; provided, however, that the Technical Committee shall not constitute a part of the board of directors of the Company or any of its Subsidiaries (including the Project Company) and will not have authority to direct the management of the Company or any of its Subsidiaries (including the Project Company).
(C) The Technical Committee shall establish and maintain such procedures as it considers necessary or advisable.
(D) The Technical Committee shall be comprised of (1) the Company’s Executive Vice President, Capital Projects, (2) the Company’s Vice President, Projects, (3) a representative from OMF Fund IV SPV M LLC (or an Affiliate thereof), (4) a representative of the Independent Engineer and (5) a representative of the Independent Environmental and Social Consultant.
(E) The Technical Committee shall hold regular monthly meetings at such time and place (by telephonic or electronic means unless otherwise agreed) as mutually agreed to by its members or, failing such agreement, shall be held virtually, as well as additional meetings on a more frequent basis if and as decided by the members of the Technical Committee. The chair of the Technical Committee shall give seven (7) days’ written notice to the members of meetings.
(F) Any reports of the Technical Committee shall be provided simultaneously to the Company and the Holder.
(G) At any such meeting, there shall be a quorum if the Holder’s appointee, the Independent Engineer and at least one member of management of the Company is present. Matters to be determined by the Technical Committee shall be determined by a majority vote of the members present at the Technical Committee meeting.
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(H) All reasonable Technical Committee costs and expenses are to be paid by the Project Company. No members of the Technical Committee, other than the Independent Engineer, shall be remunerated or otherwise paid simply for their role as members of the Technical Committee.
(17) VOTE TO ISSUE, OR CHANGE THE TERMS OF, NOTES. The prior written consent of the Required Holders and the Company shall be required for any change, waiver or amendment to this Note. Any change, waiver or amendment so approved shall be binding upon all existing and future holders of this Note; provided, however, that no such change, waiver or, as applied to any of the Notes held by any particular Holder of Notes, shall, without the written consent of that particular Holder, (i) reduce the amount of Principal, reduce the amount of accrued and unpaid Interest, reduce the Interest Rate or Default Rate or change any Interest Date or the Maturity Date, of such Notes, (ii) change the definition of Required Holders, (iii) make any change that adversely affects the conversion rights of this Note other than as required by this Note, (iv) reduce any Redemption Price or change the times at which, or the circumstances under which, such Notes may or will be redeemed or repurchased by the Company, (v) make such Note payable in a currency other than U.S. dollars, (vi) change the ranking of such Notes, (vii) impair the right of the Holder to receive payment of Principal or Interest on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Note, (viii) disproportionally and adversely affect any rights under such Note of any holder of such Note relative to the rights of any holder of any other Note; (ix) subordinate such Note in contractual right of payment to any other Indebtedness or other obligations, or (x) modify any of the provisions of, or impair the right of any holder of such Notes under, this Section 17. An instrument in writing signed by the Required Holders and the Company shall be required for any change or amendment or waiver of any provision to this Note. Any change, amendment or waiver by the Required Holders and the Holder shall be binding on the Holder of this Note.
(18) TRANSFER. This Note and any rights and obligations hereunder may be offered, sold, assigned or transferred by the Holder, in whole or in part, without the consent of the Company, subject only to the provisions of this Note.
(19) REISSUANCE OF THIS NOTE.
(a) Transfer. If this Note is to be transferred in accordance with Section 18, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Note (in accordance with Section 19(d) and subject to Section 3(c)(iii)), registered as the Holder may request, representing the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal is being transferred, a new Note (in accordance with Section 19(d)) to the Holder representing the outstanding Principal not being transferred. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of Section 3(c)(iii) following conversion or redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated on the face of this Note.
(b) Lost, Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company shall execute and deliver to the Holder a new Note (in accordance with Section 19(d)) representing the outstanding Principal.
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(c) Note Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the principal office of the Company, for a new Note or Notes (in accordance with Section 19(d)) representing in the aggregate the outstanding Principal of this Note, and each such new Note will represent such portion of such outstanding Principal as is designated by the Holder at the time of such surrender.
(d) Issuance of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note (i) shall be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding (or in the case of a new Note being issued pursuant to Section 19(a) or Section 19(c), the Principal designated by the Holder which, when added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated on the face of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have the same rights and conditions as this Note, and (v) shall represent accrued and unpaid Interest on the Principal from the Issuance Date.
(20) REMEDIES, CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Note shall be cumulative and in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity (including a decree of specific performance and/or other injunctive relief). No remedy contained herein shall be deemed a waiver of compliance with the provisions giving rise to such remedy. Nothing herein shall limit the right of a party to this Note to pursue actual damages for any failure by the other party to comply with the terms of this Note. No failure on the part of the Holder or the Company to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Holder or the Company of any right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. In addition, the exercise of any right or remedy of the Holder or the Company at law or equity or under this Note or any of the documents shall not be deemed to be an election of Holder’s or the Company’s rights or remedies under such documents or at law or equity. Each party to this Note covenants to the other party that there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion, redemption and the like (and the computation thereof) shall be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). Each party to this Note acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the other party and that the remedy at law for any such breach may be inadequate. Each party to this Note therefore agrees that, in the event of any such breach or threatened breach, the other party shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required.
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(21) PAYMENT OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in the hands of an attorney for collection or enforcement or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this Note or to enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay the reasonable and documented out-of-pocket costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including, but not limited to, reasonable and documented out-of-pocket attorneys’ fees and disbursements.
(22) CONSTRUCTION; HEADINGS. This Note shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any Person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part of, or affect the interpretation of, this Note.
(23) FAILURE OR INDULGENCE NOT WAIVER. No failure or delay on the part of the Holder or the Company in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege.
(24) DISPUTE RESOLUTION. In the case of a dispute as to the determination of, the Closing Sale Price or the arithmetic calculation of the Conversion Rate, the Conversion Price or any Redemption Price, the Company and the Holder and the Company are unable to agree upon such determination or calculation within one (1) Business Day of such disputed determination or arithmetic calculation, then the Company and the Holder shall submit via electronic mail (a) the disputed determination of the Closing Sale Price to an independent, reputable investment bank mutually agreed by the Company and the Holder, such approval not to be unreasonably withheld, conditioned or delayed, or (b) the disputed arithmetic calculation of the Conversion Rate, Conversion Price or any Redemption Price to an independent, outside accountant, mutually agreed by the Company and the Holder, such approval not to be unreasonably withheld, conditioned or delayed. The Holder and the Company shall cause the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than five (5) Business Days from the time it receives the disputed determinations or calculations. Such investment bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error. The expenses of the investment bank or the accountant shall be borne equally by the Holder and the Company.
(25) NOTICES; PAYMENTS.
(a) Notices. Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance with Section 10(f) of the Transaction Agreement. The Company shall give written notice to the Holder (i) promptly upon any adjustment of the Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment, (ii) promptly after any amendment, supplement or waiver of any
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provision of this Note and (iii) at least ten (10) Business Days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Common Shares, (B) with respect to any grants, issuances or sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property to holders of Common Shares or (C) for determining rights to vote with respect to any Merger Event or Change of Control or Company Change of Control, dissolution or liquidation, provided in each case that such information shall be made known to the public prior to or in conjunction with such notice being provided to the Holder.
(b) Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, such payment shall be made in lawful money of the United States of America via wire transfer of immediately available funds to an account designated by the Holder; provided, that the Holder, upon written notice to the Company, may elect to receive a payment of cash in lawful money of the United States of America by a check drawn on the account of the Company and sent via overnight courier service to such Person at such address as previously provided to the Company in writing (which address, in the case of the Holder, shall initially be as set forth on the “Schedule of Buyers” attached to the Transaction Agreement). Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day.
(26) CALLBACK PROCEDURE. Notwithstanding any other provision of this Note, no notice, instruction or other communication relating to any change in any details of the Company or the Holder relating to payment (including the identify of such Person, receiving bank or receiving account number, broker, or broker account number), or in any details of such Person’s callback contact, will be valid, and shall not be complied with by any party unless:
(a) written notice of the change is given in accordance with Section 25;
(b) the Person giving notice of the change is not a callback contact further to Section 27; and
(c) such instruction is confirmed verbally by telephone or voice over internet protocol call, and not by writing in any form, between the Company’s callback contact and the Holder’s callback contact using the relevant details for that callback in Section 27, with such verbal confirmation being further confirmed to the callback contact of the Party giving such instruction via a second written notice given by the callback contact of the Party receiving such instruction in accordance with Section 25 contemporaneously with the completion of such verbal confirmation.
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(27) CALLBACK CONTACTS. The callback contacts for Section 26 are the following Persons with the following contact details, or such Persons or contact details as the relevant party may notify from time to time in accordance with Section 26:
(a) Callback contact for the Company:
Name: Luke Colton
Email: [***]
Telephone Number: [***]
(b) Callback contact for the Holder:
Name: Jeffrey Feeley
Email: [***]
Telephone Number: [***]
(28) CANCELLATION. After all Principal, any accrued Interest and any other amounts at any time owed on this Note have been paid in full, this Note shall automatically be deemed canceled and shall not be reissued, sold or transferred.
(29) NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND SHAREHOLDERS. No past, present or future director, officer, employee, incorporator or shareholder of the Company, as such, will have any liability for any obligations of the Company under this Note or for any claim based on, in respect of, or by reason of, such obligations or its creation. By accepting this Note, the Holder waives and releases all such liability. Such waiver and release are part of the consideration for the issuance of this Note.
(30) GOVERNING LAW; JURISDICTION; JURY TRIAL. This Note shall be governed by and construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Note shall be governed by, the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. Each of the Company and the Holder hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in New York, New York, Borough of Manhattan and any appellate court from any thereof, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each of the Company and the Holder hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such Person at the address set forth in Section 10(f) of the Transaction Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY AND THE HOLDER EACH HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY.
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(31) SEVERABILITY. If any provision of this Note is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Note so long as this Note as so modified continues to express, without material change, the original intentions of the Company and the Holder as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the Company or the Holder or the practical realization of the benefits that would otherwise be conferred upon the Company or the Holder. The Company and the Holder will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
(32) USURY. This Note is subject to the express condition that at no time shall the Company be obligated or required to pay interest hereunder at a rate or in an amount which could subject the Holder to either civil or criminal liability as a result of being in excess of the maximum interest rate or amount which the Company is permitted by applicable law to contract or agree to pay. If by the terms of this Note, the Company is at any time required or obligated to pay interest hereunder at a rate or in an amount in excess of such maximum rate or amount, the rate or amount of interest under this Note shall be deemed to be immediately reduced to such maximum rate or amount and the interest payable shall be computed at such maximum rate or be in such maximum amount and all prior interest payments in excess of such maximum rate or amount shall be applied and shall be deemed to have been payments in reduction of the principal balance of this Note. To the extent lawful, the interest that would have been paid under this Note but was not paid as a result of the operation of this Article shall be cumulated and the interest payable under this Note in other periods shall be increased (but not above such maximum rate or amount) until such cumulated amount shall have been received by the Holder.
(33) ABSENCE OF TRADING AND DISCLOSURE RESTRICTIONS. The Company acknowledges and agrees that the Holder is not a fiduciary or agent of the Company, and/or any of its Subsidiaries and that the Holder shall have no obligation pursuant to this Note or the other Transaction Documents (excluding any separate written agreements between the Holder and the Company as may exist from time to time) to (a) maintain the confidentiality of any information provided by the Company and/or any of its Subsidiaries or (b) refrain from trading any securities of the Company and/or any of its Subsidiaries while in possession of such information in the absence of a written non-disclosure agreement signed by an officer of the Holder that explicitly provides for such confidentiality and trading restrictions. For the avoidance of doubt, the immediately preceding sentence shall not in any way limit the Company’s rights under Section 3(r) of the Registration Rights Agreement.
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(34) CERTAIN DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:
(a) “Acquisition” means any transaction, or any series of related transactions, consummated on or after the Initial Closing Date, by which the Company or any Subsidiary (a) acquires any going business or all or substantially all of the assets of any Person, whether through purchase of assets, merger or otherwise or (b) directly or indirectly acquires (in one transaction or as the most recent transaction in a series of transactions) at least a majority (in number of votes) of the Equity Interests of a Person which has ordinary voting power for the election of directors or other similar management personnel of a Person (other than Equity Interests having such power only by reason of the happening of a contingency) or a majority of the outstanding Equity Interests of a Person.
(b) “Affiliate” shall have the meaning ascribed to such term in Rule 405 of the Securities Act.
(c) “Affiliate Support Agreement” means that certain Affiliate Support, Share Retention and Subordination Agreement, dated as of October 28, 2024 (as amended and restated by the Omnibus Amendment and Termination Agreement, dated (and as in effect) as of December 17, 2024), by and among the Project Company, the Company, 1339480 B.C. Ltd., KV Project LLC, United States Department of Energy and Citibank, N.A.
(d) “Anti-Corruption Laws” means all laws concerning or relating to anti-bribery, anti-corruption, and anti-kickback matters in the public or private sector, including the U.S. Foreign Corrupt Practices Act of 1977, as amended, the Corruption of Foreign Public Officials Act (Canada), as amended, the Criminal Code (Canada), as amended, or, in each case, any similar laws.
(e) “Anti-Corruption Policy” means the anti-bribery and anti-corruption policy of the Group Members (which shall include United States Foreign Corrupt Practices Act compliance) adopted by the Board of Directors, as the same may be amended, revised, supplemented or replaced from time to time in accordance with this Agreement.
(f) “Anti-Money Laundering Laws” means the Currency and Foreign Transactions Reporting Act of 1970 (otherwise known as the Bank Secrecy Act), the PATRIOT Act, the Anti-Money Laundering Act of 2020, the Money Laundering Control Act, the rules and regulations thereunder, applicable Executive Orders, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), the Criminal Code (Canada) and any other Applicable Laws relating to money laundering, terrorist financing, or financial recordkeeping and recording requirements administered or enforced by any United States of America or Canada governmental agency, or any other jurisdiction in which any Group Member operates or conducts business.
(g) “Applicable Laws” means, with respect to any Person, any constitution, statute, law, rule, regulation, code, ordinance, treaty, judgment, order or any published directive, guideline, requirement or other governmental rule or restriction which has the force of law, by or from a court, arbitrator or other Governmental Authority having jurisdiction over such Person or any of its properties, whether in effect as of the date of this Agreement or as of any date hereafter.
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(h) “Articles” shall have the meaning ascribed to such term in the Transaction Agreement.
(i) “Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as that term is used in Section 13(d)(3) of the Exchange Act), such “person” will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only after the passage of time. The term “Beneficially Owns” has a corresponding meaning. For purposes of this definition, a Person shall not be deemed to Beneficially Own securities that are the subject of a stock purchase agreement, merger agreement or similar agreement until consummation of the transactions or, as applicable, series of related transactions contemplated thereby.
(j) “Bloomberg” means Bloomberg Financial Markets.
(k) “BLM” means the U.S. Bureau of Land Management.
(l) “Board of Directors” means the board of directors of the Company or a committee of such board duly authorized to act for it hereunder.
(m) “Business” means the development, construction, expansion and operation of the Project and the related sale of lithium products.
(n) “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in New York, New York, Vancouver, British Columbia or Reno, Nevada are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any Governmental Authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in New York, New York, Vancouver, British Columbia and Reno, Nevada generally are open for use by customers on such day.
(o) “Canadian Dam Association (CDA) Standards” means the CDA 2019 Technical Bulletin on Application of Dam Safety Guidelines to Mining Dams and a Guide to the Management of Tailings Facilities March 2021, Version 3.2 by the Mining Association of Canada, with corresponding references and any implementation protocols (each as updated, expanded or replaced in whole or in part from time to time).
(p) “Capital Lease Obligation” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases or financing leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.
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(q) “Capitalized Interest” means, with respect to the payment of Interest on an Interest Date, the amount of such Interest that the Company has elected to pay by way of inclusion of such Interest in the Principal.
(r) “Cash Interest” means, with respect to the payment of Interest on an Interest Date, the amount of such Interest that the Company has elected (or is deemed to have elected) in accordance with Section 2(a) to pay in cash.
(s) “Change of Control” shall be deemed to have occurred if the Company ceases to own, directly or indirectly, more than 50% of all outstanding equity interests of the Project Company or the Project Company disposes of all or substantially all of the assets of the Project Company taken as a whole.
(t) “Change of Control Caps” has the meaning ascribed to such term in Section (4)(a)(iv).
(u) “Close of Business” means 5:00 p.m. (New York City time).
(v) “Closing Sale Price” means, for any security as of any date, the last closing trade price for such security on the NYSE, as reported by Bloomberg, or, if the NYSE begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price, as the case may be, then the last bid price or last trade price, respectively, of such security prior to 4:00 p.m., New York time, as reported by Bloomberg, or, if the NYSE is not the principal securities exchange or trading market for such security, the last trade price of such security on the principal securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last trade price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, or, if no last trade price is reported for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported in the Pink Open Market (f/k/a OTC Pink) published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices). If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then such dispute shall be resolved pursuant to Section 22. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or other similar transaction relating to the Common Shares during the applicable calculation period.
(w) “Code” means the Internal Revenue Code of 1986, as amended.
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(x) “Common Equity” of any Person means Equity Interests of such Person that is generally entitled (i) to vote in the election of directors of such Person or (ii) if such Person is not a corporation, to vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the management or policies of such Person.
(y) “Common Shares” means the Company’s Common Shares, no par value, subject to Section 5(c).
(z) “Company Change of Control” means
(i) any transaction as a result of which any “person” or “group” of related persons (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than a Permitted Holder, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Company (for the purposes of this clause (1), such person or group shall be deemed to Beneficially Own any Voting Stock of the Company held by a parent entity, if such person or group Beneficially Owns, directly or indirectly, more than 50% of the total voting power of the Voting Stock of such parent entity); or
(ii) the sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Company and its Subsidiaries taken as a whole to any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act).
(aa) “Compliance Certificate” means a certificate of the Chief Executive Officer or the Chief Financial Officer of the Company in the form set out in Schedule 14(p)(ii)(C).
(bb) “Construction Budget” means the Initial Construction Budget, as updated, amended or supplemented from time to time pursuant to the terms hereof.
(cc) “Construction Contract” has the meaning ascribed to such term in the DOE Loan.
(dd) “Contract” means any agreement, contract, lease, license, concession, option, indenture, mortgage, deed of trust, debenture, note or other instrument, arrangement.
(ee) “Conversion Shares” means Common Shares issuable by the Company pursuant to the terms of any of the Notes, including any related Interest so converted or redeemed.
(ff) “Convertible Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable for Common Shares.
(gg) “Default” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.
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(hh) “Dispose”, “Disposition” or “Disposal” means the sale, transfer, license, lease or other disposition (in one transaction or in a series of transactions) of any property by any Person (including any issuance of Equity Interests by a Subsidiary of such Person), including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.
(ii) “DOE” means the United States Department of Energy.
(jj) “DOE Financing Document” means each “Financing Document” as such term is defined in the DOE Loan (as they exist as of the date hereof).
(kk) “DOE Loan” means that certain Loan Arrangement and Reimbursement Agreement, dated as of October 28, 2024, by and between the Project Company and the U.S. Department of Energy, as amended by that certain Omnibus Amendment, dated as of December 17, 2024, and any amendments, supplements, modifications, extensions, renewals, or restatements thereof.
(ll) “Effective Date” means the first date on which the Common Shares trade on the applicable exchange or in the applicable market, regular way, reflecting the relevant share split or share combination, as applicable.
(mm) “Eligible Market” means any Principal Market, the NYSE American, The Nasdaq Capital Market, The Nasdaq Global Select Market or The Nasdaq Global Market (or any of their respective successors).
(nn) “Environmental Laws” means any and all foreign, federal, state, provincial, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of any Governmental Authority or other Applicable Law (including common law) regulating, relating to or imposing liability or standards of conduct concerning (a) protection of the environment, natural resources, or human health or safety (including but not limited to mining health and safety); or (b) the presence, Release or threatened Release, generation, use, management, handling, transportation, treatment, storage, or disposal of Hazardous Substances, in each case of clause (a) and (b) as now or may at any time hereafter be in effect.
(oo) “Environmental and Social Requirements” means: all Environmental and Laws, all environmental Governmental Approvals, conformance with the Equator Principles and the CDA tailings standards consistent with Prudent Industry Practice, in each case as applicable to the then current phase of the Project.
(pp) “Equator Principles” means those principles so entitled and described in “The ‘Equator Principles – July 2020’ - A financial industry benchmark for determining, assessing and managing social and environmental risk in Projects” and available at: http://equator-principles.com/about/, as adopted as at the date of this Note, and including all applicable IFC EHS guidelines required therein.
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(qq) “Equity Interests” means (a) all shares of capital stock (whether denominated as common capital stock or preferred capital stock), equity interests, beneficial, partnership or membership interests, joint venture interests, participations or other ownership or profit interests in or equivalents (regardless of how designated) of or in a Person (other than an individual), whether voting or non-voting and (b) all securities convertible into or exchangeable for any of the foregoing and all warrants, Options or other rights to purchase, subscribe for or otherwise acquire any of the foregoing, whether or not presently convertible, exchangeable or exercisable; provided that this Note will not constitute an Equity Interest.
(rr) “Ex-Dividend Date” means the first date on which the Common Shares trade on the applicable exchange or in the applicable market, regular way, without the right to receive the issuance, dividend or distribution in question, from the Company or, if applicable, from the seller of Common Shares on such exchange or market (in the form of due bills or otherwise) as determined by such exchange or market.
(ss) “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.
(tt) “Event of Force Majeure” means an event or circumstance beyond the reasonable control of, and not the result of the fault or negligence of, the Project Company, and that could not have been prevented by the exercise of reasonable diligence by the Project Company, including any act of God, fire, flood, severe weather, epidemic, pandemic, equipment failure, failure or delay in issuance of Governmental Approvals (but which Governmental Approval the Project Company must be using commercially reasonable efforts to obtain) or other acts or inaction of Governmental Authorities (but which act or inaction the Project Company must be using commercially reasonable efforts to contest or reverse), change in Applicable Law, default by suppliers or contractors, quarantine restriction, explosion, sabotage, strike or other material labor disruption, act of war, act or threat of terrorism or riot or civil commotion.
(uu) “Excluded Taxes” means any of the following Taxes imposed on or with respect to the Holder or required to be withheld or deducted from a payment to the Holder, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, Canadian capital Taxes and branch profits Taxes, in each case, (i) imposed as a result of the Holder being organized under the laws of, or having its principal office or its applicable lending office located in the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Taxes imposed as a result of a present or former connection between the Holder and the jurisdiction imposing such Tax (other than connections arising from the Holder having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced this Note, or sold or assigned an interest in this Note), (b) Canadian withholding Taxes imposed on amounts payable to or for the account of the Holder with respect to an applicable interest in this Note pursuant to a law in effect on the date on which (i) the Holder subsequently acquires such interest in this Note after the date hereof from the original Holder or (ii) the Holder changes its lending office, except in each case to the extent that, pursuant to Section 6, amounts with respect to such Taxes were payable either to the Holder’s assignor immediately before the Holder became a party hereto or to the Holder immediately before it changed its lending office, (c) any Canadian Tax that would not have been imposed but for the Holder (including direct or indirect holders of the Holder, as the case may be) (i) not dealing at arm’s length for purposes of the ITA with the Company, (ii)
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being a “specified non-resident shareholder” (as defined in subsection 18(5) of the ITA) of the Company or not dealing at arm’s length for purposes of the ITA with a “specified shareholder” (as defined in subsection 18(5) of the ITA) of the Company, or (iii) the Company being a “specified entity” pursuant to paragraph (b) of the definition thereof (as defined in subsection 18.4(1) of the ITA) in respect of the Holder, (d) Taxes attributable to the Holder’s failure to comply with Section 6(b) and (e) any withholding Taxes imposed under FATCA or Taxes imposed pursuant to Part XVIII of the ITA.
(vv) “FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Note (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities entered into in connection with the implementation of the foregoing.
(ww) “Foreign Private Issuer” means a “foreign private issuer” within the meaning of Rule 3b-4 of the Exchange Act.
(xx) “Global Industry Standard on Tailings Management” or “GISTM” means the “Global Industry Standard on Tailings Management” or “GISTM” as endorsed by the International Council on Mining and Metals and any implementation protocols (each as updated, expanded or replaced in whole or in part from time to time).
(yy) “GAAP” means generally accepted accounting principles in the United States as in effect from time to time.
(zz) “GM Investment Documents” means the Investor Rights Agreement, the JV Investment Agreement, the LAC-GM JV LLCA and the Management Services Agreement.
(aaa) “Governmental Approval” means any approval, consent, authorization, license, permit, order, certificate, qualification, waiver, exemption, or variance, or any other action of a similar nature, of or by a Governmental Authority, including any of the foregoing that are or may be deemed given or withheld by failure to act within a specified time period.
(bbb) “Governmental Authority” means the government of the U.S., Canada any other nation or any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
(ccc) “Group Members” means, collectively, the Company and its Subsidiaries from time to time, including the Project Company, and “Group Member” means any one of them.
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(ddd) “Guarantee”, of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.
(eee) “Hazardous Substances” means any substances, chemicals, materials or wastes defined, listed, classified or regulated as hazardous, toxic, or a pollutant or contaminant or for which standards are or liability may be imposed by any Governmental Authority under, any applicable Environmental Laws, including (a) any petroleum or petroleum by-products (including gasoline, crude oil or any fraction thereof), flammable explosives, radioactive materials, asbestos in any form that is or could become friable, urea formaldehyde foam insulation, per- and polyfluoroalkyl substances, and polychlorinated biphenyls, noise, odor, and vibration; and (b) any other chemical, material or substance, of which the import, storage, transport, use, Release or disposal of, or exposure to, is prohibited, limited, or regulated or for which liability may be imposed under any Environmental Law.
(fff) “Hedging Agreement” means any agreement or instrument (including a cap, swap, collar, option, forward purchase agreement or other similar derivative instrument) relating to the hedging of any interest under any Indebtedness, including any foreign currency trading or other speculative transactions.
(ggg) “HSEC Policy” means the integrated health, safety, environmental and community policies and operating guidelines for the Project adopted by the Board of Directors.
(hhh) “IFRS” means the International Financial Reporting Standards, adopted by the International Accounting Standards Board, as in effect from time to time.
(iii) “Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been
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assumed (including all Purchase Money Obligations), (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit, demand guarantees and similar independent undertakings, (j) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, (k) obligations under any earn-out (which for all purposes of this Note shall be valued at the maximum potential amount payable with respect to such earn-out) and (l) any other Off-Balance Sheet Liability. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.
(jjj) “Indemnified Taxes” means Taxes (other than Excluded Taxes) imposed on or with respect to any payment made by or on account of any obligation of the Company under this Note (including, for greater certainty, the issuance of Conversion Shares as provided in Section 3).
(kkk) “Independent Engineer” shall mean Hatch Ltd. or such other internationally reputable engineering consultants appointed from time to time by the Holder to act as technical advisor engineer in connection with the Project.
(lll) “Independent Environmental and Social Consultant” or “IESC” shall mean Sustrio Advisors or such other internationally reputable environmental and social consultants appointed from time to time by the Holder to act as environmental and social consultant in connection with the Project.
(mmm) “Initial Closing Date” shall have the meaning ascribed to such term in the Transaction Agreement.
(nnn) “Initial Construction Budget” shall have the meaning ascribed to such term in the DOE Loan.
(ooo) “Integrated Project Schedule” shall have the meaning ascribed to such term in the DOE Loan.
(ppp) “Intermediate Holding Companies” means all Subsidiaries of the Company that are direct or indirect parent companies of Project Holdco.
(qqq) “Investor Rights Agreement” means the Amended and Restated Investor Rights Agreement, dated as of October 15, 2024, between the Company and General Motors Holdings LLC.
(rrr) “IRR” means internal rate of return, as calculated using the XIRR function in Microsoft Excel with the initial amount being the outstanding principal balance followed by any Cash Interest payments thereon.
(sss) “ITA” means the Income Tax Act (Canada), as amended.
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(ttt) “JV Investment Agreement” means that certain Investment Agreement dated as of October 15, 2024, among the Company, Lithium Nevada Ventures LLC and General Motors Holdings LLC, as amended from time to time.
(uuu) “LAC-GM JV LLCA” means that certain Amended and Restated Limited Liability Company Agreement of Lithium Nevada Ventures LLC, dated as of December 20, 2024, between LAC US Corp. and General Motors Holdings LLC, as amended from time to time.
(vvv) “Lien” means with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset.
(www) “Major Project Document” means each of (with each of the terms below having the meaning ascribed to such term in the DOE Loan):
(i) the EPCM Agreement;
(ii) the Bechtel Construction Contract;
(iii) the Mining Agreement;
(iv) the Offtake Agreement;
(v) the Aquatech Purchase Agreement;
(vi) the EXP EPC Agreement;
(vii) the Affiliate Indemnification Agreement;
(viii) the MECS License Agreement;
(ix) the Malta Ready Mix Purchase Order;
(x) each TLT Document;
(xi) each Real Property Document;
(xii) each Workforce Hub Document, from and after the date of execution thereof;
(xiii) each Major Subcontract;
(xiv) each Additional Major Project Document;
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(xv) any other Project Document if, but only if, the Company and the Holder agree (in their sole discretion) that such document shall be treated as a “Major Project Document”; and
(xvi) any credit support instrument provided in connection with any of the foregoing, irrespective of whether the Company or and of its Subsidiaries is a party thereto.
(xxx) “Management Services Agreement” means that certain Management Services Agreement, dated as of December 20, 2024, by and among LAC Management LLC, the Company, Project Holdco and the Project Company, as amended from time to time.
(yyy) “Material Adverse Effect” shall have the meaning ascribed to such term in the Transaction Agreement.
(zzz) “Maturity Date” means April 1, 2030.
(aaaa) “Mine” means a lithium mine located on public lands administered by the U.S. Bureau of Land Management in Humboldt County, Nevada known as “Thacker Pass.”
(bbbb) “Mine Plan” means the annual schedule of activities developed by the Miner for the mine pit development and first twenty-five years of lithium carbonate production and forecasts annual operating costs, volumes, and compositions as well as various statistics required for operation of the process plan.
(cccc) “Miner” means Sawtooth Mining, LLC, a Nevada limited liability company.
(dddd) “MOIC” shall mean a multiple of invested capital equal to the quotient of (i) the sum of (x) the aggregate amount of all Cash Interest (other than any Cash Interest paid at the Default Rate) paid to the Holder prior to the applicable date of determination and (y) the applicable Change of Control Redemption Price and (ii) the Purchase Price. For the avoidance of doubt, in no event shall any calculation of MOIC take into account (i) any fees or expenses incurred by the Holder that are reimbursed by the Company, (ii) any payments in cash pursuant to Section 3(c)(ii) or (iii) any indemnification payments made by the Company to the Holder.
(eeee) “Monthly Construction Report” means a written report in relation to a calendar month with respect to the Project in the form attached as Schedule 14(p)(i)(B).
(ffff) “Monthly Operations Report” means a written report prepared by or on behalf of the Company in relation to the immediately preceding calendar month, in the form attached as Schedule 14(p)(i)(A).
(gggg) “Moody’s” means Moody’s Investors Service, Inc. and any successor thereto that is a nationally recognized rating agency.
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(hhhh) “NYSE” means the New York Stock Exchange.
(iiii) “O&M Budget” shall have the meaning ascribed to such term in the DOE Loan.
(jjjj) “OFAC” means The Office of Foreign Assets Control of the US Department of the Treasury.
(kkkk) “Off-Balance Sheet Liability” of a Person means (a) any repurchase obligation or liability of such Person with respect to accounts or notes receivable sold by such Person, (b) any indebtedness, liability or obligation under any so-called “synthetic lease” transaction entered into by such Person, or (c) any indebtedness, liability or obligation arising with respect to any other transaction which is the functional equivalent of or takes the place of borrowing but which does not constitute a liability on the balance sheet of such Person (other than operating leases).
(llll) “Open of Business” means 9:00 a.m. (New York City time).
(mmmm) “Operating Forecast” shall have the meaning ascribed to such term in the DOE Loan.
(nnnn) “Operating Plan” shall have the meaning ascribed to such term in the DOE Loan.
(oooo) “Options” means any rights, warrants or options to subscribe for or purchase (i) Common Shares or (ii) Convertible Securities.
(pppp) “Order” means any order, directive, decree, judgment, ruling, award, injunction, direction or request of any Governmental Authority or other decision-making authority of competent jurisdiction.
(qqqq) “Permitted Acquisition” means any Acquisition by the Company or any Subsidiary in a transaction that satisfies each of the following requirements:
(i) the business acquired in connection with such Acquisition is not engaged, directly or indirectly, in any line of business other than the businesses in which the Company or any Subsidiaries are engaged on the Initial Closing Date and any business activities that are substantially similar, related, or incidental thereto;
(ii) both before and after giving effect to such Acquisition and any concurrent incurrence of Indebtedness in connection therewith, each of the representations and warranties in the Transaction Documents is true and correct (except any such representation or warranty which relates to a specified prior date, in which case such representation or warranty is true and correct as of such specified prior date) and no Default exists, will exist, or would result therefrom;
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(iii) as soon as available, but not less than ten (10) days prior to such Acquisition, the Company has provided the Holder (A) notice of such Acquisition and (B) a copy of all business and financial information reasonably requested by the Holder including pro forma financial statements, statements of cash flow and diligence reports;
(iv) the total consideration (including the maximum potential total amount of all deferred payment obligations (including earn-outs) and Indebtedness assumed or incurred) for all Acquisitions made during any fiscal year of the Company shall not exceed $25,000,000;
(v) if such Acquisition is an acquisition of the Equity Interests of a Person, such Acquisition is structured so that the acquired Person shall become a Subsidiary of the Company;
(vi) if such Acquisition involves a merger or a consolidation involving the Company or any Subsidiary, the Company or such Subsidiary, as applicable, shall be the surviving entity; and
(vii) none of the Company or any Subsidiary shall, as a result of or in connection with any such Acquisition, assume or incur any direct or contingent liabilities (whether relating to environmental, tax, litigation, or other matters) that could have a Material Adverse Effect.
(rrrr) “Permitted Company Indebtedness” means, in respect of the Company, any Intermediate Holding Company or Project Holdco, any of the following:
(i) Indebtedness of the Company in respect of the Notes, any Additional Notes and, in each case, Capitalized Interest in respect thereof;
(ii) Indebtedness existing on the date hereof and set forth in Schedule 3(s) of the Transaction Agreement and any extensions, renewals, refinancings and replacements of any such Indebtedness in accordance with clause (v) hereof;
(iii) Indebtedness (A) of any Subsidiary of the Company to the Company or any other Subsidiary or (B) of the Company to any Subsidiary of the Company, solely to the extent that any such Indebtedness is expressly subordinated in right of payment to this Note pursuant to a subordination agreement in form and substance satisfactory to the Required Holders acting reasonably;
(iv) Guarantees by the Company of Indebtedness of any Subsidiary and by any Subsidiary of Indebtedness of the Company or any other Subsidiary; provided that the Indebtedness so Guaranteed is Permitted Company Indebtedness and so long as the aggregate amount of such Guarantee does not exceed the Company’s allocable share of the liability, based on its direct or indirect ownership percentage of such Subsidiary at the time such Guarantee is provided, and such maximum shall be adjusted from time to time to reflect any changes in the Company’s ownership stake in such Subsidiary;
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(v) Indebtedness which represents extensions, renewals, refinancing or replacements (such Indebtedness being so extended, renewed, refinanced or replaced being referred to herein as the “Refinance Indebtedness”) of any of the Indebtedness described in clauses (i), (ii) and (viii) hereof (such Indebtedness being referred to herein as the “Original Indebtedness”); provided that (A) such Refinance Indebtedness does not increase the principal amount of the Original Indebtedness except by (x) an amount equal to unpaid accrued interest, premium and penalties thereon plus other amounts paid, and fees and expenses incurred, in connection with such modification, refinancing, refunding, renewal, replacement or extension and (y) an amount equal to any existing unutilized commitments, (B) any Liens securing such Refinance Indebtedness are not extended to any additional property of the Company or any Subsidiary, (C) none of the Company or any Subsidiary that is not originally obligated with respect to repayment of such Original Indebtedness is required to become obligated with respect to such Refinance Indebtedness, and (D) such Refinance Indebtedness does not result in a shortening of the average weighted maturity of such Original Indebtedness;
(vi) Indebtedness owed to any Person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance, pursuant to reimbursement or indemnification obligations to such Person, in each case incurred in the ordinary course of business;
(vii) Indebtedness in respect of performance bonds, bid bonds, appeal bonds, surety bonds and similar obligations (including guarantees thereof), in each case provided in the ordinary course of business;
(viii) Indebtedness pursuant to p-card, corporate credit card or similar programs in an aggregate amount not to exceed $5,000,000 at any time outstanding;
(ix) Indebtedness that is expressly subordinated in right of payment to the Notes pursuant to a subordination agreement (in form and substance satisfactory to the Required Holders) with a maturity date or scheduled amortization or scheduled payments of principal or subject to mandatory redemption, repurchase, prepayment or sinking fund obligation (other than customary offers to repurchase upon a change of control and customary acceleration rights after an event of default) on or after the date that is ninety-one (91) days following the Maturity Date;
(x) Indebtedness in respect of leases of office space, office equipment or motor vehicles with respect to which the aggregate lease payments do not exceed $15,000,000 per fiscal year;
(xi) Guarantees of Indebtedness incurred pursuant to clause (ii) of the definition of Permitted Project Indebtedness so long as the aggregate amount of such Guarantee does not exceed the Company’s allocable share of the liability, based on its direct or indirect ownership percentage of the Project Company at the time such Guarantee is provided, and such maximum shall be adjusted from time to time to reflect any changes in the Company’s ownership stake in the Project Company;
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(xii) (A) amounts for insurance premiums, professional fees and fees related to corporate transactions and (B) other amounts due to trade creditors and accrued expenses not to exceed $15,000,000 at any time outstanding, in each case arising in the ordinary course of business and to the extent such amounts and expenses are not unpaid more than ninety days past the due date therefor or are being contested in good faith;
(xiii) Indebtedness incurred in connection with the issuance of GM Letters of Credit (as defined in the GM Investment Documents);
(xiv) other unsecured Indebtedness in an aggregate principal amount not exceeding $1,000,000 at any time outstanding; and
(xv) any Guarantee or other credit support on commercially reasonable terms and conditions to facilitate a sale or transfer of any Specified Tax Credit; provided that the Company or such Subsidiary may Guarantee an indemnity for losses from the sale or transfer of Specified Tax Credits on commercially reasonable terms and conditions, but if the guarantee amount exceeds the Company’s share of the liability, based on its direct or indirect ownership percentage of the Project Company at the time such Guarantee is provided, such excess portion must not exceed $38,000,000.
(ssss) “Permitted Company Investment” means, in respect of the Company, any Intermediate Holding Company or Project Holdco, any of the following:
(i) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the U.S. or Canada (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the U.S. or Canada), in each case maturing within one year from the date of acquisition thereof;
(ii) investments in commercial paper maturing within two hundred and seventy days from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P or from Moody’s;
(iii) investments in certificates of deposit, bankers’ acceptances and time deposits maturing within one hundred and eighty (180) days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the U.S. or any State thereof or Canada or any province or territory thereof which has a combined capital and surplus and undivided profits of not less than $500,000,000;
(iv) fully collateralized repurchase agreements with a term of not more than thirty (30) days for securities described in clause (i) above and entered into with a financial institution satisfying the criteria described in clause (iii) above; and
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(v) money market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000.
(vi) investments in existence on the date hereof and described in Schedule 13(e);
(vii) investments by the Company and the Subsidiaries in Equity Interests in their respective Subsidiaries;
(viii) loans or advances made by the Company to any Subsidiary and made by any Subsidiary to the Company or any other Subsidiary;
(ix) to the extent constituting investments, Guarantees of Indebtedness constituting Permitted Indebtedness;
(x) loans or advances made by the Company or a Subsidiary to its employees on an arms-length basis in the ordinary course of business consistent with past practices for travel and entertainment expenses, relocation costs and similar purposes;
(xi) any Guarantee or other credit support on commercially reasonable terms and conditions to facilitate a sale or transfer of any Specified Tax Credit; provided that the Company or such Subsidiary may Guarantee an indemnity for losses from the sale or transfer of Specified Tax Credits on commercially reasonable terms and conditions, but if the guarantee amount exceeds the Company’s share of the liability, based on its direct or indirect ownership percentage of the Project Company at the time such Guarantee is provided, such excess portion must not exceed $38,000,000;
(xii) [intentionally deleted];
(xiii) Permitted Acquisitions;
(xiv) investments constituting deposits described in clauses (iii) and (iv) of the definition of the term “Permitted Encumbrances”;
(xv) to the extent constituting investments, Guarantees by the Company or any Subsidiary of the obligations of a Subsidiary which do not constitute Indebtedness;
(xvi) the extension of trade credit by the Company or a Subsidiary in the ordinary course of business;
(xvii) investments in the Project Holdco or otherwise made in connection with the transactions contemplated by the Transaction Documents, the DOE Financing Documents and the GM Investment Documents;
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(xviii) other investments made after the Initial Closing Date, in an aggregate amount not to exceed $5,000,000 at any time outstanding; and
(xix) to the extent constituting investments, Permitted Intercompany Activities.
(tttt) “Permitted Company Liens” means, in respect of the Company, any Intermediate Holding Company or Project Holdco, any of the following:
(i) Liens created pursuant to the Transaction Documents, the DOE Financing Documents and the GM Investment Documents;
(ii) Permitted Encumbrances;
(iii) any Lien on any property or asset of the Company or any Intermediate Holding Company existing on the date hereof and set forth in Schedule 13(d); provided that (A) such Lien shall not apply to any other property or asset of the Company or any Subsidiary and (B) such Lien shall secure only those obligations which it secures on the date hereof, and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;
(iv) [intentionally deleted];
(v) Liens of a collecting bank arising in the ordinary course of business under Section 4-210 of the UCC in effect in the relevant jurisdiction covering only the items being collected upon;
(vi) Liens granted by a Subsidiary in favor of the Company or another Subsidiary in respect of Indebtedness owed by such Subsidiary;
(vii) Liens in respect of Indebtedness incurred pursuant to clause (xiii) of the definition of Permitted Company Indebtedness; and
(viii) other Liens securing obligations in an amount not to exceed $5,000,000 at any time outstanding.
(uuuu) “Permitted Contest Conditions” means a contest, pursued in good faith, challenging the enforceability, validity, interpretation, amount or application of any Applicable Law or other matter (legal, contractual or other) by appropriate proceedings timely instituted if (a) the applicable Supplier Entity diligently pursues such contest; (b) the applicable Supplier Entity establishes adequate reserves with respect to the contested claim to the extent required by the Designated Standard (as defined in the DOE Loan as of the date hereof); and (c) such contest could not reasonably be expected to have a Material Adverse Effect.
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(vvvv) “Permitted Debt Payments” means any of the following:
(i) payment of Indebtedness created under the Transaction Documents, the DOE Loan and the GM Investment Documents;
(ii) payment of regularly scheduled interest and principal payments as and when due in respect of any Permitted Indebtedness;
(iii) refinancings of Indebtedness to the extent the Indebtedness such refinanced is Permitted Indebtedness and is not for an amount greater than the Indebtedness being refinanced; and
(iv) payments of Indebtedness permitted pursuant to clauses (iii), (xii), and (xv) of the definition of Permitted Company Indebtedness.
(wwww) “Permitted Disposition” shall have the meaning ascribed to such term in the DOE Loan.
(xxxx) “Permitted Encumbrance” means any of the following:
(i) Liens imposed by law for Taxes that are not yet delinquent and payable or are being contested in good faith;
(ii) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than thirty (30) days or are being contested in good faith;
(iii) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance, health insurance and other social security laws or regulations;
(iv) deposits to secure the performance of bids, rental deposits, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature in each case in the ordinary course of business;
(v) judgment Liens in respect of judgments that do not constitute an Event of Default;
(vi) customary Liens of a depository bank or securities intermediary under applicable law or the applicable account documentation for the applicable deposit account or securities account;
(vii) any interest or title of a lessor, sublessor, licensor or sublicensor under any leases, subleases, licenses or sublicenses entered into by the Company or any Subsidiary in the ordinary course of business; and
(viii) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Company or any Subsidiary;
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provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness, except with respect to clause (v) above.
(yyyy) “Permitted Holder” means OMF Fund IV SPV M LLC and its Affiliates.
(zzzz) “Permitted Indebtedness” means, collectively, Permitted Company Indebtedness and Permitted Project Indebtedness.
(aaaaa) “Permitted Intercompany Activities” means shared administrative, overhead, technology or licensing arrangements entered into in the ordinary course of business between or among the Company and its Subsidiaries, in each case that (i) are, in the good faith judgment of the Company, necessary or advisable in connection with the ownership or operation of the business of the Company and its Subsidiaries and (ii) do not interfere in any material respect with the ordinary conduct of business of the Company or any Subsidiary.
(bbbbb) “Permitted Project Indebtedness” means, in respect of the Project Company, any of the following:
(i) Indebtedness incurred under the DOE Financing Documents;
(ii) Indebtedness in respect of amounts due to trade creditors and accrued expenses, in each case arising in the ordinary course of business, to the extent such amounts and expenses are not unpaid more than ninety days past the due date therefor or are being contested in good faith;
(iii) Indebtedness comprised of purchase money obligations or leases for discrete items of property and equipment not comprising an integral part of the Project, the amount of which does not exceed (A) the cost of the equipment so financed or (B) an aggregate amount not to exceed $25,000,000;
(iv) Indebtedness required pursuant to Section 7.16 of the DOE Loan;
(v) Permitted Subordinated Loans;
(vi) Indebtedness in respect of leases of office space, office equipment, motor vehicles and the other leases on Schedule 9.16(d) (Permitted Leases) to the DOE Loan as of the date hereof and any replacement thereof, with respect to which the aggregate lease payments do not exceed $75,000,000 per fiscal year;
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(vii) Indebtedness in respect of any bankers’ acceptances, letters of credit, warehouse receipts or similar facilities, in each case, incurred in the ordinary course of business;
(viii) unsecured and subordinated Indebtedness incurred after the Project Completion Date for general corporate purposes in an aggregate amount outstanding at any one time not to exceed $10,000,000;
(ix) to the extent constituting Indebtedness, indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course or other cash management services in the ordinary course of business;
(x) Indebtedness in respect of netting services, overdraft protections and otherwise in connection with deposit accounts;
(xi) contingent liabilities incurred in the ordinary course of business, including the acquisition or sale of goods, services, supplies or merchandise in the normal course of business, the endorsement of negotiable instruments received in the normal course of business and indemnities provided under any of the Project Documents;
(xii) Indebtedness of the Project Company to the Company or any Subsidiary of the Company;
(xiii) to the extent constituting Indebtedness, obligations in respect of performance bonds, bid bonds, appeal bonds, indemnification obligations, obligations to pay insurance premiums, take-or-pay obligations contained in supply agreements and similar obligations incurred in the ordinary course of business (including guarantees thereof); and
(xiv) after the Project Completion Date, Indebtedness incurred to finance Phase Two in an aggregate amount not to exceed one of the following (not both) (x) if such Indebtedness is solely funded by the DOE, $2,500,000,000 at any time outstanding, or (y) in any other case, $1,500,000,000 at any time outstanding, provided that such Indebtedness is not secured by any security interest in the collateral securing the DOE Loan.
(ccccc) “Permitted Project Investments” means, in respect of the Project Company, any of the following:
(i) direct obligations of the United States (including obligations issued or held in book-entry form on the books of the United States Department of the Treasury) or Canada or obligations, the timely payment of principal and interest of which is fully guaranteed by the United States or Canada maturing not more than one hundred eighty days from the date of the creation thereof;
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(ii) obligations, debentures, notes or other evidence of Indebtedness issued or guaranteed by any agency or instrumentality of the United States or Canada maturing not more than three hundred and sixty days from the date of the creation thereof;
(iii) interest-bearing demand or time deposits (including certificates of deposit) that are held in banks with a general obligation rating of not less than “A-” by S&P or the equivalent rating by Moody’s, or if not so rated of a market value of no less than the amount of moneys so invested maturing not more than one hundred eighty days from the date of the creation thereof;
(iv) commercial paper rated (on the date of acquisition thereof) at least “A-1” or “P-1” or equivalent by S&P or Moody’s, respectively (or an equivalent rating by another nationally recognized credit rating agency of similar standing if neither of such corporations is then in the business of rating commercial paper), maturing not more than ninety days from the date of creation thereof;
(v) money market funds, so long as such funds are rated “Aaa” by Moody’s and “AAA” by S&P; and
(vi) any other advances, loans or extensions of credit or any stock, bonds, notes, debentures or other securities as permitted under the DOE Loan.
(ddddd) “Permitted Project Liens” means, in respect of the Project Company, any of the following:
(i) any Liens securing the DOE Loan and any Secured Obligations (as defined in the DOE Loan) thereunder;
(ii) Liens for any tax, assessment or other governmental charge that is (A) not yet delinquent; or (B) being diligently contested in good faith and by appropriate proceedings timely instituted, so long as (1) such proceedings shall not involve any danger of the sale, forfeiture or loss of the Project and (2) a bond, adequate reserves or other security has been posted or provided in such manner and amount as to assure that any taxes, assessments or other charges determined to be due will promptly be paid in full when such contest is determined;
(iii) Liens in favor of materialmen, workers or repairmen, or other like Liens arising in the ordinary course of business or in connection with the construction of the Project, that are either not overdue for a period of more than thirty days or for amounts being diligently contested in good faith and by appropriate proceedings timely instituted so long as (A) such proceedings shall not involve any danger of the sale, forfeiture or loss of any part of the Project, and (B) a bond or other security has been posted or provided in such manner and amount as to assure that any amounts determined to be due will promptly be paid in full when such contest is determined;
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(iv) Liens identified in the ALTA Survey (as defined in the DOE Loan);
(v) zoning, entitlement, building and other land use regulations imposed by Governmental Authorities having jurisdiction over the Project Site that do not and could not reasonably be expected to materially impair the development, construction, operation, or use by (or for the benefit of) the Project Company of the Project Site;
(vi) covenants, conditions, restrictions, easements and other similar encumbrances on title, and other minor defects or irregularities of record affecting title to the Project Site, which do not and could not reasonably be expected to materially impair the development, construction, operation, access to or use by (or for the benefit of) the Project Company of the Project Site;
(vii) Liens (not securing Indebtedness) of depository institutions and securities intermediaries (including rights of set-off or similar rights) with respect to deposit accounts or securities accounts;
(viii) Liens securing (A) judgments for the payment of money that do not constitute an Event of Default or (B) appeals and the other surety bonds related thereto;
(ix) deposits to secure the performance of bids, trade contracts and leases (other than Indebtedness), statutory obligations, surety bonds (other than bonds related to judgments or litigation), performance bonds and other obligations of a like nature incurred in the ordinary course of business; and
(x) Liens in respect of Indebtedness described in clause (iii) of the definition of Permitted Project Indebtedness;
(xi) Liens in respect of Indebtedness described in clause (iv) of the definition of Permitted Project Indebtedness, to the extent related to warehouse receipts;
(xii) non-exclusive licenses of intellectual property granted in the ordinary course of business;
(xiii) other Liens so long as neither (i) the aggregate outstanding amount of the obligations secured thereby nor (ii) the aggregate fair market value (determined as of the date such Lien is incurred) of the assets subject thereto exceeds $20,000,000 at any one time outstanding; and
(xiv) Liens in respect of Indebtedness described in clause (xiv) of the definition of Permitted Project Indebtedness.
(eeeee) “Permitted Subordinated Loans” means any subordinated loans made by, or on behalf of, the Company or 1339480 B.C. Ltd. to the Project Company in lieu of purchasing Equity Interests, on the terms and conditions set forth in the Affiliate Support Agreement.
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(fffff) “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity and any government or any department or agency thereof.
(ggggg) “Phase One” means the initial phase of development of the Project.
(hhhhh) “Phase One Effective Date” has the meaning ascribed to such term in the JV Investment Agreement.
(iiiii) “Phase Two” means an expansion phase of development of the Project.
(jjjjj) “Principal Market” means the NYSE and the TSX.
(kkkkk) “Production Payment Agreement” shall have the meaning ascribed to such term in the Transaction Agreement.
(lllll) “Project” means the Thacker Pass lithium project located in the State of Nevada, including the Project Property, the mining, development, production, processing, recovery, sale, transportation, storage and delivery operations and related assets and rights and other assets or rights located on or at or used in connection with the Project Property or to mine minerals.
(mmmmm) “Project Company” shall have the meaning ascribed to such term in the Transaction Agreement.
(nnnnn) “Project Completion” shall have the meaning ascribed to such term in the DOE Loan.
(ooooo) “Project Completion Date” shall have the meaning ascribed to such term in the DOE Loan.
(ppppp) “Project Completion Longstop Date” shall have the meaning ascribed to such term in the DOE Loan.
(qqqqq) “Project Document” means each Major Project Document and each other agreement necessary or appropriate for the Project, including any contract or agreement relating to the ownership, development, construction, testing, operation, maintenance, repair or use of the Project entered into by the Company or any of its Subsidiaries with any other Person, including any credit support instrument in respect of any other Project Document irrespective of whether the Company of its Subsidiaries is a party thereto, but excluding (a) any Transaction Document or DOE Financing Document, (b)(i) any mandate letter with the Holder and any similar agreement with any third-party advisor of the Company and (ii) any fee letter or professional services agreement, consulting agreement or advisory agreement in respect of any professional
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services and any similar agreement with any third-party advisor of the Company (in each case, so long as, at any time of determination, any amounts payable by such Person under or in connection with such contract or agreement (A) have been or are reasonably expected to be incurred in the ordinary course of business and (B) are contemplated by the then-current relevant Construction Budget or O&M Budget, as applicable), and (c) any other agreement or document executed by the Company in connection with any other Indebtedness that constitutes Permitted Indebtedness.
(rrrrr) “Project Entity” means from time to time, the Company, 1339480 B.C. Ltd., the Project Company and Project Holdco and any other Person that is an Affiliate of a Group Member (now or hereafter formed or acquired) that holds or acquires directly or indirectly any interest in the Project Property other than any Person holding an interest in the Project Property solely through its interest in the Company.
(sssss) “Project Holdco” means Lithium Nevada Ventures, LLC and its successors.
(ttttt) “Project Mining Claims” means each unpatented mining claim set forth on Schedule 16(a)(ii) (Project Mining Claims), claimed by the Project Company, including all such unpatented mining claims on the Project Site and such unpatented mining claims that are not more than approximately two (2) miles from the Project Site (in each case, whether such unpatented mining claims exist on the date hereof or arise after the date hereof), recorded with the BLM, and filed or recorded in the real property records of Humboldt County, Nevada, subject in all cases to the paramount title of the United States of America.
(uuuuu) “Project Property” means all of the property, assets, undertaking, approvals, licenses, permits and rights of the Group Members in and relating to the Project, whether now owned or existing or hereafter acquired or arising, including real property, personal property and lithium interests, and specifically including, but not limited to: (a) the Project Real Property and lithium interests; (b) all accounts, instruments, chattel paper, deposit accounts, documents, intangibles, goods (including inventory, equipment and fixtures), money, letter of credit rights, supporting obligations, claims, causes of action and other legal rights and investment property in each case relating to the Project; (c) all products, proceeds (including proceeds of proceeds), rents and profits of the foregoing; and (d) all books and records of the Group Members related to any of the foregoing.
(vvvvv) “Project Real Property” means all real property interests, all mineral claims, mineral leases and other mineral rights, concessions, unpatented mining claims and interests, and all surface access rights held by any Group Member relating to the Project, and all buildings, structures, improvements, appurtenances and fixtures thereon or attached thereto, whether created privately or by the action of any Governmental Authority. “Project Real Property” shall also include any term extension, renewal, replacement, conversion or substitution of any such real property interests, mineral claims, mineral leases, mineral rights, concessions, unpatented mining claims or interests, and surface access rights, owned or in respect of which an interest is held, directly or indirectly, by any Group Member at any time during the term of this Note, whether or not such ownership or interest is held continuously.
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(wwwww) “Project Site” means the Real Property and Project Mining Claims on which the Project is or is intended to be situated, as further described in Schedule 16(a)(iii) (Project Site).
(xxxxx) “Processing Facility” has the meaning given to such term in the preliminary statements, and includes beneficiation; the offsite water supply and associated infrastructure including wells, pumps and pipeline; steam turbine generator; temporary, black-start and back-up on-site power; sulfuric acid plant; evaporation and crystallization equipment; vat leach and neutralization plant; counter current decantation plant, filtration plants, precipitation equipment, ion exchange equipment and lithium carbonate circuit; lithium carbonate product drying, handling and packaging; reagent handling equipment; ore handling and sizing and storage area and structures and associated equipment; in-process, clay tailings and final product storage area and associated structures, utilities, facilities and equipment; waste management facilities (for hazardous and other waste managed onsite); and balance of plant equipment associated with the aforementioned systems and equipment.
(yyyyy) “Prudent Industry Practice” means those practices, methods, equipment, specifications, and standards of safety and performance, as are commonly accepted in the lithium mining and processing industries as good, safe, prudent and commercial practices in connection with the design, construction, operation, maintenance, repair and use of the Project.
(zzzzz) “Purchase Money Obligations” means the outstanding balance of the purchase price of real and/or personal property, title to which has been acquired or will be acquired upon payment of such purchase price, or indebtedness to non-vendor third parties incurred to finance the acquisition of such new and not replacement real and/or personal property, or any refinancing of such indebtedness or outstanding balance.
(aaaaaa) “Purchase Price” shall have the meaning ascribed to such term in the Transaction Agreement.
(bbbbbb) “Quarterly Operations Report” means a written report prepared by or on behalf of the Company in relation to the immediately preceding fiscal quarter, in the form attached as Schedule 14(p)(ii)(A)(1).
(cccccc) “Quarterly Construction Report” means a written report in relation to a fiscal quarter with respect to the Project in the form attached as Schedule 14(p)(ii)(A)(2).
(dddddd) “Record Date” means, with respect to any dividend, distribution or other transaction or event in which the holders of Common Shares (or other applicable security) have the right to receive any cash, securities or other property or in which the Common Shares (or such other security) is exchanged for or converted into any combination of cash, securities or other property, the date fixed for determination of holders of the Common Shares (or such other security) entitled to receive such cash, securities or other property (whether such date is fixed by the Board of Directors, by statute, by contract or otherwise).
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(eeeeee) “Redemption Dates” means, collectively, the Event of Default Redemption Date, the Change of Control Redemption Date and the Company Redemption Date, as applicable, each of the foregoing, individually, a Redemption Date.
(ffffff) “Redemption Notice” means, collectively, the Event of Default Redemption Notice, the Change of Control Redemption Notice and the Company Redemption Notice, each of the foregoing, individually, a Redemption Notice.
(gggggg) “Redemption Premium” means, as of the date of determination, the percentage of the applicable Conversion Amount for which the Redemption Premium is being determined that is required to result in the Change of Control Redemption Price reflecting the greater of (x) a MOIC of 135% and (y) an IRR of 12%.
(hhhhhh) “Redemption Price” means, collectively, the Event of Default Redemption Price, the Change of Control Redemption Price and the Company Redemption Price, each of the foregoing, individually, a Redemption Price.
(iiiiii) “Registration Rights Agreement” means that certain Registration Rights Agreement dated as of the Initial Closing Date by and among the Company and the initial Holder of this Note relating to, among other things, the registration of the resale of the Common Shares issuable pursuant to the terms of this Note, as may be amended, amended and restated, supplemented or otherwise modified from time to time.
(jjjjjj) “Registrable Securities” shall have the meaning ascribed to such term in the Registration Rights Agreement.
(kkkkkk) “Registration Statement” shall mean any registration statement filed with the SEC under the Securities Act (which includes any Registration Statement).
(llllll) “Release” means, with respect to Hazardous Substances, any disposing, discharging, injecting, spilling, leaking, leaching, dumping, pumping, pouring, emitting, escaping, emptying, seeping, placing, releasing, abandoning, depositing, or migrating or dispersing into, through or upon the natural or man-made environment (including any land, water or air and the abandonment or discarding of barrels, containers, and other closed receptacles containing Hazardous Substances), and “Released” shall have a corresponding meaning.
(mmmmmm) “Required Project Approvals” shall have the meaning ascribed to such term in the Transaction Agreement.
(nnnnnn) “Restricted Payment” means any (i) payment, dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the Company or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests or any option, warrant or other right to acquire any such Equity Interests, (ii) payment on account of any principal of, or interest or premium on, or to purchase, redeem, retire or defease, or of any amount in respect of a sinking or analogous fund or defeasance fund for, any Indebtedness ranking in right of payment, parri
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passu or subordinate to the Note or any Additional Notes, or (iii) payment in respect of any management, consulting or similar fee, or any material bonus or comparable payment, or material payment by way of gift or other gratuity, to any Affiliate of the Company, unless such payment is to a director, officer or employee in that capacity and consists of reimbursement for reasonable and ordinary course expenses related to the business of a Project Entity incurred by such individual in accordance with the policies in effect governing such reimbursements.
(oooooo) “Required Holders” shall have the meaning ascribed to such term in the Transaction Agreement.
(pppppp) “Rule 144” means Rule 144 promulgated under the Securities Act.
(qqqqqq) “Rule 144A” means Rule 144A promulgated under the Securities Act.
(rrrrrr) “S&P” means S&P Global Ratings, a division of S&P Global Inc., and any successor thereto that is a nationally recognized rating agency.
(ssssss) “Sanctions” means any economic, financial, and trade sanctions laws and export controls, Applicable Laws, regulations, embargoes or restrictive measures administered or enforced by (a) the United States government, including OFAC, the U.S. Department of State, and the U.S. Department of Commerce, (b) any U.S. Executive Orders imposing economic or financial sanctions on any individuals, entities or foreign countries or regimes and (c) the Canadian government including Global Affairs Canada, the Royal Canadian Mounted Police, and the Canada Border Services Agency.
(tttttt) “SEC” means the United States Securities and Exchange Commission.
(uuuuuu) “Securities Act” means the U.S. Securities Act of 1933, as amended.
(vvvvvv) “Specified Tax Credit” means the advanced manufacturing production tax credit, as defined in Section 45X of the Code and the Treasury Regulations promulgated thereunder, or any successor to or replacement of such credit.
(wwwwww) “Transaction Agreement” means that certain transaction agreement dated as of March 5, 2025 by and among the Company and the investor listed on the signature pages attached thereto pursuant to which the Company issued the Notes, as may be amended, amended and restated, supplemented or otherwise modified from time to time.
(xxxxxx) “Subscription Date” means April 1, 2025.
(yyyyyy) “Subsidiary” shall have the meaning ascribed to such term in the Transaction Agreement.
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(zzzzzz) “Substantial Completion” shall have the meaning ascribed to such term in the DOE Loan.
(aaaaaaa) “Substantial Completion Long Stop Date” shall have the meaning ascribed to such term in the DOE Loan.
(bbbbbbb) “Taxes” or “taxes” means any present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, similar fees or other similar charges imposed by any Governmental Authority, including interest, additions to tax or penalties applicable thereto.
(ccccccc) “Tailings” means the materials left over after the primary process of separating the valuable fraction from the uneconomical fraction of the lithium and excludes waste rock or other material that overlies the lithium or mineral body and is displaced during mining without being processed.
(ddddddd) “Tailings Facility” means the Tailings disposal facilities to be constructed by the Company and its Subsidiaries pursuant to the Mine Plan which will be used for deposition of Tailings from each of the Mine, and all related infrastructure and equipment.
(eeeeeee) “Technical Committee” means the technical committee established by the Company to oversee the development and construction of the Project.
(fffffff) “Trading Day” means any day on which the Common Shares are traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Shares on such day, then on the principal securities exchange or securities market on which the Common Shares are then listed or admitted for trading. If the Common Shares are not so listed or admitted for trading, “Trading Day” means a Business Day.
(ggggggg) “Transaction Documents” shall have the meaning ascribed to such term in the Transaction Agreement.
(hhhhhhh) “TSX” means the Toronto Stock Exchange.
(iiiiiii) “U.S.” means the United States of America.
(jjjjjjj) “UCC” means the Uniform Commercial Code.
(kkkkkkk) “Voting Stock” of an entity means all classes of Equity Interests of such entity then outstanding and normally entitled to vote in the election of members of such entity’s board of directors.
(lllllll) “Wholly-Owned Subsidiary” with respect to a Person means a Subsidiary of such Person whose Equity Interests are 100% owned, directly or indirectly, by such Person.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused this Note to be duly executed as of the Issuance Date set out above.
| LITHIUM AMERICAS CORP. | ||
| By: | /s/ Jonathan Evans | |
| Name: Jonathan Evans | ||
| Title: Chief Executive Officer | ||
[Signature Page to Convertible Note]
Exhibit 4.7
Certain identified information in this Agreement denoted with “[***]” has been excluded from this exhibit pursuant to Item 601(b)(10)(iv) of Regulation S-K because it is both not material and of the type that the registrant treats as private and confidential.
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is entered into effective as of April 1, 2025 by and among Lithium Americas Corp., a corporation existing under the laws of the Province of British Columbia, Canada (the “Company”), and OMF Fund IV SPV M LLC (the “Buyer”).
WHEREAS:
A. In connection with the Transaction Agreement by and among the Company and the Buyer, dated as of March 5, 2025 (as may be amended, amended and restated, supplemented or otherwise modified from time to time, the “Transaction Agreement”), the Company has agreed, upon the terms and subject to the conditions of the Transaction Agreement, to issue and sell to the Buyer unsecured convertible notes of the Company (the “Notes”), which will, among other things, be convertible into the Company’s common shares, no par value per share (the “Common Shares”) (the Common Shares issuable upon conversion under the terms of the Notes, collectively, the “Conversion Shares”).
B. In accordance with the terms of the Transaction Agreement, the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the “Securities Act”), and applicable state securities laws.
NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Buyer hereby agree as follows:
1. Definitions.
Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Transaction Agreement. As used in this Agreement, the following terms shall have the following meanings:
(a) “Adoption Agreement” means an Adoption Agreement substantially in the form attached hereto as Exhibit A.
(b) “Affiliate” shall have the meaning ascribed to such term in Rule 405 of the Securities Act.
(c) “Automatic Shelf” means an “automatic shelf registration statement” within the meaning of Rule 405 under the Securities Act.
(d) “Business Day” means any day, other than (i) a Saturday, Sunday or statutory holiday in the Province of British Columbia or the City of New York and (ii) a day on which banks are generally closed in the Province of British Columbia or the City of New York.
(e) “Capitalized Interest” shall have the meaning assigned to such term in the Notes.
(f) “effective” and “effectiveness” refer to a Registration Statement that has been declared effective by the SEC or otherwise becomes effective automatically in accordance with the rules and regulations of the SEC and is available for the resale of the Registrable Securities required to be covered thereby.
(g) “Effective Date” means the date that the Registration Statement has been declared effective by the SEC or otherwise becomes effective automatically in accordance with the rules and regulations of the SEC.
(h) “Effectiveness Deadline” means (i) 60 calendar days after the Filing Deadline in the case of a filing on Form S-3 and (ii) 90 days calendar after the Filing Deadline in the case of a filing on Form S-1.
(i) “Eligible Markets” means the New York Stock Exchange, the Toronto Stock Exchange, the NYSE American, The Nasdaq Capital Market, The Nasdaq Global Select Market or The Nasdaq Global Market (or any of their respective successors).
(j) “Filing Date” means the date on which the Registration Statement is initially filed with the SEC.
(k) “Filing Deadline” means (i) forty-five (45) days after the date hereof, in respect of the Initial Notes, and (ii) ten (10) business days after the Delayed Closing Date, in respect of the Delayed Notes.
(l) “Interest” shall have the meaning assigned to such term in the Notes.
(m) “Investor” means the Buyer or a Permitted Transferee.
(n) “Permitted Transferee” means with respect to any Person (i) any Affiliate of such Person, other than a Disqualified Institution, (ii) any Transferee, other than a Disqualified Institution, to whom the Buyer Transfers Registrable Securities in accordance with the terms of the Transaction Documents (as defined in the Transaction Agreement) having a reasonably estimated value of at least $50,000,000 on the date of such Transfer (or on the date of the binding agreement with respect to such Transfer) or (iii) any Transferee to which the Company consents in writing; provided, in each case, that such Transferee has delivered to the Company a duly executed Adoption Agreement.
(o) “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and any government or any department or agency thereof.
(p) “register,” “registered,” and “registration” refer to a registration effected by preparing and filing one or more Registration Statements in compliance with the Securities Act and pursuant to Rule 415, and the declaration or ordering of effectiveness of such Registration Statement(s) by the SEC or such Registration Statement otherwise becoming automatically effective in accordance with the rules and regulations of the SEC.
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(q) “Registrable Securities” means (i) the Conversion Shares issued or issuable pursuant to the terms of the Initial Notes and the Delayed Notes, it being understood that the Conversion Shares issuable upon conversion of the Delayed Notes shall not be “Registrable Securities” unless and until the corresponding Delayed Notes are issued and sold to the Buyer, and (ii) any capital stock of the Company issued or issuable with respect to the Notes or the Conversion Shares as a result of any stock split, stock dividend, recapitalization, exchange, adjustment to the Conversion Price or similar event or otherwise, in each case, without regard to any limitations on conversion and/or redemption of the Notes; provided, that any Registrable Security will cease to be a Registrable Security upon the earliest to occur of when (A) a Registration Statement covering such Registrable Security has become effective under the Securities Act and such Registrable Security has been disposed of pursuant to such Registration Statement, (B) such Registrable Security may (at such time and/or upon issuance, as applicable) be disposed of without restriction or limitation pursuant to Rule 144 and without the requirement to be in compliance with Rule 144(c)(1) (or any successor thereto) promulgated under the Securities Act, and any restrictive legend thereon has been removed or (C) such Registrable Security has been sold or disposed of in a transaction in which the Transferor’s rights under this Agreement are not assigned to the Transferee pursuant to Section 9; and provided, further, that any security that has ceased to be a Registrable Security shall not thereafter become a Registrable Security and any security that is issued or distributed in respect of any security that was a Registrable Security and has ceased to be a Registrable Security shall not be a Registrable Security.
(r) “Registration Statement” means a registration statement or registration statements of the Company filed under the Securities Act covering the resale of the Registrable Securities.
(s) “Required Holders” means the holders of at least a majority of the Registrable Securities and shall include the Investors so long as the Buyer or any of its Affiliates holds any Registrable Securities.
(t) “Required Registration Amount” means, as of any time of determination, all of the Registrable Securities then issued or issuable pursuant to the terms of the Notes, determined without regard to any limitations on conversion of the Notes and assuming that the Notes are then fully convertible into Common Shares at the then-prevailing applicable conversion price contemplated therein.
(u) “Rule 415” means Rule 415 promulgated under the Securities Act or any successor rule providing for offering securities on a continuous or delayed basis.
(v) “SEC” means the United States Securities and Exchange Commission.
(w) “Transfer” means any offer, sale, pledge, encumbrance, hypothecation, entry into any contract to sell, grant of an option to purchase, short sale, assignment, transfer, exchange, gift, bequest or other disposition, direct or indirect, in whole or in part, by operation of law or otherwise. “Transfer,” when used as a verb, and “Transferee” and “Transferor” have correlative meanings.
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(x) “WKSI” means a “well-known seasoned issuer” within the meaning of Rule 405 under the Securities Act.
2. Registration.
(a) Mandatory Registration. The Company shall use commercially reasonable efforts to prepare, and, as soon as reasonably practicable but in no event later than the applicable Filing Deadline, to file with the SEC (1) a Registration Statement covering the resale of the Required Registration Amount of Registrable Securities in respect of the Initial Notes; and (2) a Registration Statement covering the resale of the Required Registration Amount of Registrable Securities in respect of the Delayed Notes, provided such Registration Statement may be effected via post-effective amendment to such Registration Statement covering the resale of the Required Registration Amount of Registrable Securities in respect of the Initial Notes. Each such Registration Statement shall be on Form S-3 and shall be an Automatic Shelf if the Company shall then be a WKSI (any such Registration Statement, a “WKSI Registration Statement”)); provided that, and subject to Section 2(c), if the Company is not then eligible to register for resale the Registrable Securities on Form S-3, such registration shall be on Form S-1, and if for any reason the Company is not then eligible to register for resale the Registrable Securities on Form S-1, then such registration shall be on another appropriate form for such purpose. Each such Registration Statement shall contain (except if otherwise directed by the Required Holders) the “Plan of Distribution” and “Selling Shareholders” sections in form reasonably satisfactory to the Required Holders. If a Registration Statement is not a WKSI Registration Statement, the Company shall use its commercially reasonable efforts to have such Registration Statement declared effective by the SEC as soon as reasonably practicable after the filing thereof and in any event, no later than the applicable Effectiveness Deadline.
(b) Legal Counsel. Subject to Section 5 hereof, the Required Holders shall have the right to select one legal counsel to review and oversee any registration pursuant to this Section 2 (“Legal Counsel”), which shall be Torys LLP or such other counsel as thereafter designated by the Required Holders. The Company and Legal Counsel shall reasonably cooperate with each other in performing the Company’s obligations under this Agreement.
(c) Ineligibility for Form S-3. In the event that Form S-3 (or such other form type applicable to an existing Registration Statement) is not available for the registration of the resale of Registrable Securities hereunder, the Company shall (i) register the resale of the Registrable Securities on Form S-1 or another appropriate form reasonably acceptable to the Required Holders and (ii) undertake to register the Registrable Securities on Form S-3 reasonably promptly after such form becomes available (and, to the extent the Company qualifies as a WKSI as of the initial filing date for such Registration Statement, such Registration Statement shall be an Automatic Shelf); provided, that the Company shall use commercially reasonable efforts to maintain the effectiveness of the Registration Statement then in effect until such time as a Registration Statement on Form S-3 covering the Registrable Securities has been declared effective by the SEC or otherwise becomes effective automatically in accordance with the rules and regulations of the SEC.
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(d) Sufficient Number of Shares Registered. In the event the number of shares registered for resale by the Investors under a Registration Statement filed pursuant to Section 2(a) or Section 2(c) is insufficient to cover the number of Conversion Shares issued or issuable pursuant to the terms of the Notes and, without duplication, all of the Registrable Securities (a “Registration Deficiency”), the Company shall, upon the Required Holders’ written request, use commercially reasonable efforts to amend the applicable Registration Statement, or file a new Registration Statement (on Form S-3 or another short form registration available therefor and as an Automatic Shelf, if applicable), or both, so as to cover at least the Required Registration Amount of Registrable Securities as of the Business Day immediately preceding the date of the filing of such amendment or new Registration Statement, in each case, as soon as practicable, but in any event not later than ten (10) calendar days after such request is received. The Company shall use commercially reasonable efforts to cause such amendment and/or new Registration Statement to become effective as soon as practicable following the filing thereof.
(e) Effect of Failure to Obtain and Maintain Effectiveness of Registration Statement. While the applicable Registration Statement is required to be filed by the Company pursuant to this Agreement, if (A) the applicable Registration Statement is not declared (or otherwise becomes) effective by the SEC on or before the applicable Effectiveness Deadline (an “Effectiveness Failure”); or (B) the effectiveness of the applicable Registration Statement lapses for any reason (including, without limitation, the issuance of a stop order) or such Registration Statement (or the prospectus contained therein) is unavailable to any holder of Registrable Securities for sale of all of such holder’s Registrable Securities in accordance with the terms herein, and such lapse or unavailability continues for a period of five (5) consecutive days or for more than an aggregate of ten (10) days in any 365-day period (excluding days during an Allowable Grace Period) (a “Maintenance Failure”); then, as partial relief for the damages to the Buyer by reason of any such delay in or reduction of its ability to sell the Registrable Securities (which remedy shall not be exclusive of any other remedies available at law or in equity, including, without limitation, specific performance), the Company shall pay to each Buyer holding Registrable Securities relating to such Registration Statement an amount in cash equal to (i) with respect to the first thirty (30) day period following the first day of any Effectiveness Failure or Maintenance Failure, as applicable, one and a half percent (1.5%) of the aggregate Purchase Price of such Buyer’s Registrable Securities that would be included in the Registration Statement to which the applicable Effectiveness Failure or Maintenance Failure relates but for such Effectiveness Failure or Maintenance Failure, whether or not included in such Registration Statement, (ii) with respect to the second thirty (30) day period following the first day of any Effectiveness Failure or Maintenance Failure, as applicable, for the first fifteen (15) days thereof, one and a half percent (1.5%) of the aggregate Purchase Price of such Buyer’s Registrable Securities that would be included in the Registration Statement to which the applicable Effectiveness Failure or Maintenance Failure relates but for such Effectiveness Failure or Maintenance Failure, whether or not included in such Registration Statement, and, for the next fifteen (15) days thereof, two and a half percent (2.5%) of the aggregate Purchase Price of such Buyer’s Registrable Securities that would be included in the Registration Statement to which the applicable Effectiveness Failure or Maintenance Failure relates but for such Effectiveness Failure or Maintenance Failure, whether or not included in such Registration Statement, and (iii) with respect to any subsequent thirty (30) day periods, two and a half percent (2.5%) of the aggregate Purchase Price of such Buyer’s Registrable Securities that would be included in the Registration Statement to which the applicable Effectiveness Failure or Maintenance Failure relates but for
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such Effectiveness Failure or Maintenance Failure, whether or not included in such Registration Statement (the “Registration Delay Payments”). Registration Delay Payments shall be paid as Capitalized Interest and be paid to each applicable Buyer on each of the following dates: (i) the day of an Effectiveness Failure or a Maintenance Failure, as applicable, (ii) on the thirtieth (30) day after the date of an Effectiveness Failure or a Maintenance Failure, as applicable, and every thirtieth day thereafter (pro-rated for periods totaling less than thirty days) until such Effectiveness Failure or Maintenance Failure is cured. Registration Delay Payments shall be paid on the earlier of (I) the dates set forth above and (II) the third Business Day after the event or failure giving rise to the Registration Delay Payments is cured. In the event the Company fails to make Registration Delay Payments in a timely manner, such Registration Delay Payments shall bear Interest at the rate of two percent (2.0%) per month (prorated for partial months) until paid in full. For avoidance of doubt, the accrual of any Registration Delay Payment amounts with respect to any Holder pursuant to this Section 2(e) shall cease at such time as such Buyer shall cease to hold any Registrable Securities (or, in the event that any Maintenance Failure occurs at such time as any such Buyer holds no Registrable Securities, no Registration Delay Payments shall accrue with respect to such Buyer). Notwithstanding anything to the contrary herein, in no event shall the aggregate amount of Registration Delay Payments payable hereunder exceed fifteen percent (15.0%) of the aggregate Purchase Price for all Buyers (with such amounts to be paid pro rata in such event).
3. Related Obligations.
At such time as the Company is obligated to file a Registration Statement with the SEC pursuant to Section 2(a), 2(c) or 2(d), the Company will use its commercially reasonable efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and, pursuant thereto, the Company shall use its commercially reasonable efforts to comply with the following obligations:
(a) The Company shall keep each Registration Statement effective pursuant to Rule 415 at all times until all of the Registrable Securities covered by such Registration Statement have ceased to be Registrable Securities (the “Registration Period”). The Company shall ensure that, when effective, (i) each Registration Statement (including any amendments or supplements thereto) will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and (ii) in the case of any prospectus contained in a Registration Statement, such prospectus will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which such statements were made, not misleading. The Company shall respond in writing to comments made by the SEC in respect of a Registration Statement or any of the documents incorporated by reference therein as soon as reasonably practicable after receipt thereof.
(b) Subject to the provision by each holder of Registrable Securities of all information reasonably requested by the Company for such purposes, the Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and the prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424(b) promulgated under the Securities Act, as may be necessary to keep such Registration Statement effective at all times
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during the Registration Period, and, during such period, comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities of the Company covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such Registration Statement. In the case of amendments and supplements to a Registration Statement which are required to be filed pursuant to this Agreement (including pursuant to this Section 3(b)) by reason of the Company filing a report on Form 10-K, Form 10-Q, Form 8-K, proxy statement or any analogous report under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company shall, if permitted under the applicable rules and regulations of the SEC, have incorporated such report by reference into such Registration Statement, if applicable, or shall file such amendments or supplements to such Registration Statement with the SEC on the same day on which the Exchange Act report is filed which created the requirement for the Company to amend or supplement such Registration Statement.
(c) The Company shall (A) permit the Investors and Legal Counsel to review and comment upon (i) a Registration Statement at least five (5) Business Days prior to its filing with the SEC and (ii) all amendments and supplements to all Registration Statements (except for Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and any similar or successor reports) within a reasonable number of days prior to their filing with the SEC, and (B) not file any Registration Statement or amendment or supplement thereto in a form to which the Investors and/or Legal Counsel reasonably objects in writing. The Company shall not submit a request for acceleration of the effectiveness of a Registration Statement or any amendment or supplement thereto without the prior approval of the Investors and Legal Counsel, which consent shall not be unreasonably withheld. The Company shall furnish to the Investors and Legal Counsel, without charge, (i) copies of any correspondence from the SEC or the staff of the SEC to the Company or its representatives relating to any Registration Statement, (ii) unless the following are filed with the SEC through EDGAR and are available to the public through the EDGAR system, promptly after the same is prepared and filed with the SEC, one copy of any Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference, if requested by an Investor, and all exhibits and (iii) upon the effectiveness of any Registration Statement, one PDF copy of the prospectus included in such Registration Statement and all amendments and supplements thereto (or such number of written copies as Legal Counsel or such Investor may reasonably request). The Company shall reasonably cooperate with the Investors and Legal Counsel in performing the Company’s obligations pursuant to this Section 3.
(d) The Company shall furnish to each Investor whose Registrable Securities are included in any Registration Statement, without charge, such number of copies of such Registration Statement, each amendment and supplement thereto (in each case including financial statements and schedules, all exhibits and, if requested by an Investor, all documents incorporated therein by reference), the prospectus included therein (including each preliminary prospectus) and such other documents as such Investor may reasonably request from time to time in order to facilitate the disposition of the Registrable Securities owned by such Investor.
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(e) If applicable, the Company shall cooperate with the Investors to (i) register and qualify, unless an exemption from registration and qualification applies, the resale by Investors of the Registrable Securities covered by a Registration Statement under such other securities or “blue sky” laws of such jurisdictions in the United States as each Investor shall reasonably request, (ii) prepare and file in those jurisdictions such amendments (including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(e), (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such jurisdiction. The Company shall promptly notify Legal Counsel and each Investor who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable Securities for sale under the securities or “blue sky” laws of any applicable jurisdiction in the United States or its receipt of actual notice of the initiation or threatening of any proceeding for such purpose.
(f) The Company shall notify Legal Counsel and each Investor in writing of the happening of any event, as promptly as practicable after becoming aware of such event but in any event no later than the next Business Day following such event, as a result of which the prospectus included in a Registration Statement, as then in effect, includes an untrue statement of a material fact or omission to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (provided that in no event shall such notice contain any material, nonpublic information), and, subject to Section 3(o), promptly prepare a supplement or amendment to such Registration Statement to correct such untrue statement or omission, and, if requested by an Investor, deliver one PDF copy of such supplement or amendment to Legal Counsel and each Investor (or such number of written copies as Legal Counsel or such Investor may reasonably request). The Company shall also promptly notify Legal Counsel and each Investor in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a Registration Statement or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to Legal Counsel and each Investor by facsimile or email on the same day of such effectiveness), (ii) of any request by the SEC for amendments or supplements to a Registration Statement or related prospectus or related information, (iii) of the Company’s reasonable determination that a post-effective amendment to a Registration Statement would be appropriate, and (iv) of the Company’s reasonable determination that the Company is no longer eligible to use an existing Registration Statement. In the event that clause (iv) of the immediately preceding sentence is applicable, the Company shall file a new or amended Registration Statement on an appropriate form in accordance with Section 2(c), provided, that if such existing Registration Statement is on Form S-3, the Company will not be required to file a new or amended Registration Statement prior to the filing of its next update to the Registration Statement under Section 10(a)(3) of the Securities Act, provided that the existing Registration Statement on Form S-3 remains useable until such next update.
(g) The Company shall prevent the issuance of any stop order or other suspension of effectiveness of a Registration Statement, or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to promptly obtain the withdrawal of such order or suspension and to notify Legal Counsel and each Investor who holds Registrable Securities being sold of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.
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(h) The Company shall hold in confidence and not make any disclosure of information concerning an Investor provided to the Company unless (i) disclosure of such information is necessary to comply with federal, state or provincial securities laws, (ii) the disclosure of such information is necessary to avoid or correct a misstatement or omission in any Registration Statement, (iii) the release of such information is ordered pursuant to a subpoena or other final, non-appealable order from a court or governmental body of competent jurisdiction, or (iv) such information has been made generally available to the public other than by disclosure in violation of this Agreement or any other agreement. The Company agrees that it shall, upon learning that disclosure of such information concerning an Investor is sought by a court or governmental body of competent jurisdiction or through other means, give prompt written notice to such Investor and allow such Investor, at the Investor’s expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, such information.
(i) The Company shall (i) cause all of the Registrable Securities covered by a Registration Statement to be listed on each securities exchange on which securities of the same class or series issued by the Company are then listed, if any, if the listing of such Registrable Securities is then permitted under the rules of such exchange or (ii) secure the inclusion for listing or quotation of all of the Registrable Securities on at least one of the Eligible Markets. The Company shall use its reasonable best efforts to maintain the listing of the Common Shares on the New York Stock Exchange or another “national securities exchange” within the meaning of the Exchange Act until April 1, 2030. The Company shall pay all fees and expenses in connection with satisfying its obligations under this Section 3(i).
(j) The Company shall instruct its transfer agent to issue (and shall cooperate with its transfer agent with respect to such issuance) all Registrable Securities (i) covered by a Registration Statement, to the extent they are issued or delivered to the Investors after the effective date of such Registration Statement, and if the applicable holder of such Registrable Securities delivers to the Company a customary “will-comply” representation letter agreeing that such Registrable Securities will be sold under such effective registration statement, or (ii) eligible upon issuance for sale under Rule 144 without the requirement that the Company has complied with the public reporting requirements of the Exchange Act, free of any U.S. restrictive legends, and the Company shall direct its transfer agent to issue or transfer all such Registrable Securities without such legends and deposit such Registrable Securities in the appropriate account balance account at the Depository Trust Company (“DTC”) in accordance with the instructions of the holder of such Registrable Securities. The Company shall cooperate with the Investors who hold Registrable Securities being offered and, to the extent applicable, facilitate the timely preparation and delivery of certificates (or book-entry notations) (not bearing any restrictive legend) representing the Registrable Securities to be offered pursuant to a Registration Statement and enable such certificates (or book-entry notations) to be in such denominations or amounts, as the case may be, as the Investors may reasonably request and registered in such names as the Investors may request; provided, that the Investors have provided all documentation and evidence (which may include an opinion of counsel and a customary representation letter) as may be reasonably required by the Company, its counsel or its transfer agent. Notwithstanding anything to the contrary in this
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Agreement, if the Registrable Securities are issued within four months and a day from the date on which the Notes are issued, such Registrable Securities will bear the following legend: “UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE AUGUST 2, 2025.” and be subject to any applicable resale restrictions under the securities laws of Canada.
(k) If requested by an Investor, the Company shall as soon as practicable (i) incorporate in a prospectus supplement or post-effective amendment to the Registration Statement such information as an Investor reasonably requests to be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect to the Investor and the number of Registrable Securities being offered or sold by such Investor, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering; (ii) make all required filings of such prospectus supplement or post-effective amendment after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement if reasonably requested by an Investor holding any Registrable Securities.
(l) The Company shall cause the Registrable Securities covered by a Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities.
(m) The Company shall make generally available to its security holders as soon as practical, but not later than ninety (90) days after the close of the period covered thereby, an earnings statement (in form complying with, and in the manner provided by, the provisions of Rule 158 under the Securities Act) covering a twelve-month period beginning not later than the first day of the Company’s fiscal quarter next following the applicable Effective Date of a Registration Statement.
(n) The Company shall otherwise comply with all applicable rules and regulations of the SEC in connection with any registration hereunder.
(o) Notwithstanding anything to the contrary herein, the Company may (i) delay the filing or effectiveness of a Registration Statement (or any amendment thereto) or (ii) suspend the Investors’ use of any prospectus that is part of a Registration Statement upon prompt written notice to each Investor whose Registrable Securities are included in such Registration Statement (a “Suspension Notice”) (provided that in no event shall such notice contain any material non-public information regarding the Company) (in which event such Investor shall discontinue sales of Registrable Securities pursuant to such Registration Statement but may settle any then-contracted sales of Registrable Securities), in each case for a period of up to forty-five (45) days, if the Board of Directors of the Company determines that (A) such delay or suspension is in the best interest of the Company and its shareholders generally due to a pending financing or other transaction involving the Company (including a pending securities offering by the Company), (B) such registration or use of such prospectus would render the Company unable to comply with applicable securities laws in any material respect or (C) such registration or use of such prospectus would require disclosure of material information that the Company has a bona fide business purpose for preserving as confidential (any such period, a “Grace Period”);
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provided, that the Company shall promptly notify the Investors in writing of the date on which the Grace Period ends; and, provided further, that no Grace Periods collectively shall exceed an aggregate of ninety (90) days during any three hundred sixty five (365) day period (each, an “Allowable Grace Period”). For purposes of determining the length of a Grace Period above, the Grace Period shall begin on and include the date the Investors receive the notice referred to above and shall end on and include the later of (x) the date the Investors receive the notice referred to above and (y) the date referred to in such notice. Upon expiration of the Grace Period, the Company shall again be bound by the first sentence of Section 3(f) with respect to the information giving rise thereto unless such material, non-public information is no longer applicable.
(p) Other than as disclosed in its filings or any of its documents furnished with the SEC, neither the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on or after the date of this Agreement, enter into any agreement with respect to its securities, that would have the effect of materially impairing the rights granted to the Buyer in this Agreement or that otherwise materially conflicts with the provisions hereof.
(q) The Company shall instruct its transfer agent to remove (and shall cooperate with the transfer agent with respect to the removal of) any legend, notation or similar designation restricting transferability of the Registrable Securities from the certificates or book-entries evidencing Registrable Securities and deposit such Registrable Securities in the appropriate account balance account at the DTC (as directed by the holder of such Registrable Securities) if such Common Shares (i) are sold pursuant to an effective registration statement under the Securities Act, (ii) a registration statement covering the resale of the Registrable Securities is effective under the Securities Act and the applicable holder of such Registrable Securities delivers to the Company a customary “will-comply” representation letter agreeing that such Registrable Securities will be sold under such effective registration statement, (iii) are sold or transferred pursuant to Rule 144 or (iv) are eligible for sale under Rule 144 without the requirement that the Company has complied with the public reporting requirements of the Exchange Act. Each holder of Registrable Securities agrees to provide the Company, its counsel and/or the transfer agent with evidence reasonably requested by it in order to cause the removal of such legend, including, as may be appropriate, any information the Company reasonably deems necessary to determine that the legend, notation or similar designation is no longer required under the Securities Act or applicable state laws, including, in the case of clause (iv) of the immediately preceding sentence only, a certification that the holder is not an Affiliate of the Company and regarding the length of time the Notes and/or Common Shares have been held since the date such securities were acquired from the Company or an Affiliate of the Company. Any fees of the Company, the transfer agent and the Company’s counsel or Legal Counsel associated with the issuance of any legal opinion required by the Company’s transfer agent or the removal of such legend shall be borne by the Company.
(r) Any holder of Registrable Securities may deliver written notice (an “Opt-Out Notice”) to the Company requesting that such holder not receive notice from the Company of any event that would lead to a Suspension Notice as contemplated by Section 3(o); provided, however, that such holder may later revoke any such Opt-Out Notice in writing. Following receipt of an Opt-Out Notice from a holder of Registrable Securities (unless subsequently revoked), the Company shall not deliver any such notice to such holder pursuant to this Agreement and such
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holder shall no longer be entitled to the rights associated with any such notice and each time prior to a holder’s intended use of an effective Registration Statement, such holder will notify the Company in writing at least two (2) Business Days in advance of such intended use, and if a Suspension Notice was previously delivered (or would have been delivered but for the provisions of this Section 3(r)) and the suspension period remains in effect, the Company will so notify such holder, within one (1) Business Day of such holder’s notification to the Company, by delivering to such holder a copy of such previous Suspension Notice, and thereafter will provide such holder with the related notice of the conclusion of such suspension period immediately upon its availability.
(s) In the event that one or more Investors elect to dispose of Registrable Securities totaling 5% or more of the outstanding Common Shares of the Company pursuant to a block trade (a “Block Trade”), the Company shall, at the request of the Investors, enter into customary agreements and shall take all such other customary actions as are requested by the Investors in order to expedite or facilitate the disposition of such Registrable Securities.
4. Obligations of the Investors.
(a) At least five (5) Business Days prior to the first anticipated Filing Date of a Registration Statement, the Company shall notify each Investor in writing of the information the Company requires from each such Investor if such Investor elects to have any of such Investor’s Registrable Securities included in such Registration Statement. It shall be a condition precedent to the obligations of the Company to complete any registration pursuant to this Agreement with respect to the Registrable Securities of a particular Investor that such Investor shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as shall be reasonably required to effect and maintain the effectiveness of the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request.
(b) Each Investor, by such Investor’s acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of any Registration Statement hereunder, unless such Investor has notified the Company in writing of such Investor’s election to exclude all of such Investor’s Registrable Securities from such Registration Statement.
(c) Each Investor agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3(g) or Section 3(f), such Investor will immediately discontinue disposition of Registrable Securities pursuant to any Registration Statement(s) covering such Registrable Securities until such Investor’s receipt of copies of the supplemented or amended prospectus, or new or amended Registration Statement, as contemplated by Section 3(g) or Section 3(f) or receipt of notice that no supplement or amendment or new or amended Registration Statement is required.
(d) Each Investor covenants and agrees that it will comply with the prospectus delivery requirements of the Securities Act as applicable to it or an exemption therefrom in connection with sales of Registrable Securities pursuant to the Registration Statement.
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5. Expenses of Registration.
All reasonable and documented expenses, other than underwriting discounts and commissions and any fees and expenses of counsel engaged by any Investor (other than Legal Counsel designated pursuant to Section 2(b)), incurred in connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including, without limitation, all registration, listing and qualifications fees, printers and accounting fees, and fees and disbursements of counsel for the Company, shall be paid by the Company. The Company shall also reimburse the Investors for the reasonable and documented fees and disbursements of Legal Counsel in connection with the registration, filing or qualification pursuant to Sections 2 and 3 of this Agreement, which amount shall be limited to $[***] for each such registration, filing or qualification without the prior written consent of the Company.
6. Indemnification.
In the event any Registrable Securities are included in a Registration Statement under this Agreement:
(a) To the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend each Investor, their Affiliates, the directors, officers, partners, members, employees of, and each Person, if any, who controls any Investor or its Affiliates within the meaning of the Securities Act or the Exchange Act (each, an “Indemnified Person”), against any losses (other than loss of profits), claims (including claims asserted directly by or between an Indemnified Person and the Company), damages, liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paid in settlement or expenses, joint or several (collectively, “Claims”), incurred in investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency, body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party thereto (“Indemnified Damages”), to which any of them may become subject insofar as such Claims (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement of a material fact in a Registration Statement or any post-effective amendment thereto or in any filing made in connection with the qualification of the offering under the securities or other “blue sky” laws of any jurisdiction in which Registrable Securities are offered, or the omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus if used prior to the effective date of such Registration Statement, or included in the final prospectus (as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material fact necessary in order to make the statements made therein, in the light of the circumstances under which the statements therein were made, not misleading or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable Securities pursuant to a Registration Statement (the matters in the foregoing clauses (i) through (iii) being, collectively, “Violations”). For the avoidance of doubt, the Violations set forth in this Section 6(a) are intended to apply, and shall apply, to direct claims
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asserted by the Buyer against the Company as well as any third party claims asserted by an Indemnified Person (other than the Buyer) against the Company. Subject to Section 6(c), the Company shall reimburse the Indemnified Persons, promptly as such expenses are incurred and are due and payable, for any legal fees or other reasonable and documented expenses incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon and in conformity with information furnished in writing to the Company by or on behalf of such Indemnified Person expressly for use in connection with the preparation of the Registration Statement or any such amendment thereof or supplement thereto; (ii) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld or delayed; and (iii) shall not apply to amounts paid in settlement of any direct claim by or between an Indemnified Person and the Company. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the Transfer of the Registrable Securities by the Investors pursuant to Section 9.
(b) In connection with any Registration Statement in which an Investor is participating, each such Investor agrees to severally and not jointly indemnify, hold harmless and defend, to the same extent and in the same manner as is set forth in Section 6(a), the Company, each of its directors, each of its officers who signs the Registration Statement and each Person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act (each, an “Indemnified Party”), against any Claim or Indemnified Damages to which any of them may become subject, under the Securities Act, the Exchange Act or otherwise, insofar as such Claim or Indemnified Damages arise out of or are based upon any Violation, in each case to the extent, and only to the extent, that such Violation occurs in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Investor expressly for use in connection with such Registration Statement; and, subject to Section 6(c), such Investor shall reimburse the Indemnified Party for any legal or other expenses reasonably incurred by an Indemnified Party in connection with investigating or defending any such Claim that relates to such a Violation; provided, however, that the indemnity agreement contained in this Section 6(b) and the agreement with respect to contribution contained in Section 7 shall not apply to (x) amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of such Investor, which consent shall not be unreasonably withheld or delayed or (y) amounts paid in settlement of any direct claim by or between an Indemnified Party and such Investor; provided, further, however, that the Investor shall be liable under this Section 6(b) for only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds to such Investor as a result of the sale of Registrable Securities pursuant to such Registration Statement. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified Party and shall survive the Transfer of the Registrable Securities by the Investors pursuant to Section 9.
(c) Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding (including any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of the commencement thereof, and,
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except in the case of a direct claim, for which the remainder of this Section 6(c) shall not apply, the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided, however, that an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees and expenses of not more than one counsel for all such Indemnified Person or Indemnified Party to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the Indemnified Person or Indemnified Party, as applicable, the representation by such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding. In the case of an Indemnified Person, legal counsel referred to in the immediately preceding sentence shall be selected by the Investors holding at least a majority in interest of the Registrable Securities included in the Registration Statement to which the Claim relates. The Indemnified Party or Indemnified Person shall reasonably cooperate with the indemnifying party in connection with any negotiation or defense of any such action or Claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified Party or Indemnified Person which relates to such action or Claim. The indemnifying party shall keep the Indemnified Party or Indemnified Person fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. No indemnifying party shall be liable for any settlement of any action, claim or proceeding effected without its prior written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition its consent. No indemnifying party shall, without the prior written consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified Person of a release from all liability in respect to such Claim or litigation and such settlement shall not include any admission as to fault on the part of the Indemnified Party. Following indemnification as provided for hereunder, the indemnifying party shall be subrogated to all rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Section 6. The provisions of this Section 6(c) shall not apply to direct claims between the Company and any Investor.
(d) The indemnification required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or Indemnified Damages are incurred.
(e) The indemnity agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.
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7. Contribution.
To the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however, that: (i) no Person involved in the sale of Registrable Securities which Person is guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) in connection with such sale shall be entitled to contribution from any Person involved in such sale of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limited in amount to the amount of net proceeds received by such seller from the sale of such Registrable Securities pursuant to such Registration Statement.
8. Reports Under the Exchange Act.
With a view to making available to the Investors the benefits of Rule 144 promulgated under the Securities Act or any other similar rule or regulation of the SEC that may at any time permit the Investors to sell securities of the Company to the public without registration (“Rule 144”), the Company agrees to use its reasonable best efforts to:
(a) make and keep public information available, as those terms are understood and defined in Rule 144;
(b) file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act so long as the Company remains subject to such requirements and the filing of such reports and other documents is required for the applicable provisions of Rule 144; and
(c) furnish to each Investor so long as such Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company, if true, that it has complied with the reporting requirements of Rule 144, the Securities Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company (the delivery of which will be satisfied by the Company’s filing of such reports with the SEC through EDGAR), and (iii) such other information as may be reasonably requested to permit the Investors to sell such securities pursuant to Rule 144 without registration.
9. Assignment of Registration Rights.
The rights under this Agreement may be assigned to a Transferee of Registrable Securities (i) if such Transferee is a Permitted Transferee or (ii) with the prior written consent of the Company, provided the applicable Transferee has delivered to the Company a duly executed Adoption Agreement.
10. Amendment of Registration Rights.
Provisions of this Agreement may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Required Holders; provided, that any such amendment or waiver that complies with the foregoing but that disproportionately, materially and adversely
16
affects the rights and obligations of any Investor relative to the comparable rights and obligations of the other Investors shall require the prior written consent of such adversely affected Investor. Any amendment or waiver effected in accordance with this Section 10 shall be binding upon each Investor and the Company. No such amendment shall be effective to the extent that it applies to less than all of the holders of the Registrable Securities. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same consideration (other than the reimbursement of legal fees) also is offered to all of the parties to this Agreement.
11. Miscellaneous.
(a) If the Company receives conflicting instructions, notices or elections from two or more Persons with respect to the same Registrable Securities, the Company shall act upon the basis of instructions, notice or election received from such record owner of such Registrable Securities.
(b) Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon delivery, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (iii) upon delivery, when sent by electronic mail (provided that the sending party does not receive an automated rejection notice); or (iv) one Business Day after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses and email addresses for such communications shall be:
If to the Company:
Lithium Americas Corp.
3260-666 Burrard Street
Vancouver, British Columbia, Canada V6C 2X8
Attention: Jonathan Evans, President and CEO
E-Mail: [***]
With a copy (for informational purposes only) to each of:
Vinson & Elkins L.L.P.
845 Texas Avenue
Suite 4700
Houston, Texas 77001
Attention: Jackson O’Maley; Ben Heriaud; Layton Suchma
Email: [***]
and
Cassels Brock & Blackwell LLP
Suite 2200, RBC Place, 885 West Georgia St.
17
Vancouver, BC V6C, 3E8
Attention: David Redford
Email: [***]
If to Legal Counsel:
Torys LLP
79 Wellington St. W, Suite 3000
Toronto, Ontario M5K 1N2
Attention: Michael Pickersgill
Email: [***]
and
Torys LLP
1114 Avenue of the Americas, 23rd Floor
New York, NY 10036
Attention: Chris Bornhorst
Email: [***]
If to the Buyer, to its address and/or email address set forth on the Buyer Schedule attached hereto, with copies to such Buyer’s representatives as set forth on the Buyer Schedule, or to such other address and/or email address to the attention of such other Person as the recipient party has specified by written notice given to each other party five (5) days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s email containing the time, date and an image of the first page of such transmission or (C) provided by a courier or overnight courier service shall be rebuttable evidence of personal service or receipt from a reputable overnight delivery service in accordance with clause (A), (B) or (C) above, respectively.
(c) Failure of any party to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate as a waiver thereof.
(d) All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby
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irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
(e) If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
(f) This Agreement constitutes the entire agreement among the parties hereto with respect to the subject matter hereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein. This Agreement supersedes all prior agreements and understandings among the parties hereto with respect to the subject matter hereof.
(g) Subject to the requirements of Section 9, this Agreement shall inure to the benefit of and be binding upon the permitted successors and assigns of each of the parties hereto.
(h) The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
(i) This Agreement may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile or email transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement. Counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
(j) Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
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(k) All consents and other determinations required to be made by the Investors pursuant to this Agreement shall be made, unless otherwise specified in this Agreement, by the Required Holders, determined as if all of the outstanding Notes then held by the Investors have been converted for Registrable Securities without regard to any limitations on redemption and/or conversion of the Notes.
(l) The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction will be applied against any party.
(m) This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.
(n) The obligations of each Investor hereunder are several and not joint with the obligations of any other Investor, and no provision of this Agreement is intended to confer any obligations on any Investor vis-à-vis any other Investor. Nothing contained herein, and no action taken by any Investor pursuant hereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Investors are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated herein.
(o) Legal Counsel may rely on instructions from the Required Holders.
[Signature Page Follows]
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IN WITNESS WHEREOF, each Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the date first written above.
| COMPANY: | ||
| LITHIUM AMERICAS CORP. | ||
| By: | /s/ Jonathan Evans | |
| Name: | Jonathan Evans | |
| Title: | Chief Executive Officer | |
[Signature Page to Registration Rights Agreement]
IN WITNESS WHEREOF, the Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the date first written above.
| BUYER: | ||
| OMF FUND IV SPV M LLC | ||
| By: | /s/ Istvan Zollei | |
| Name: | Istvan Zollei | |
| Title: | Authorized Signatory | |
[Signature Page to Registration Rights Agreement]
Exhibit 5.1
Cassels Comments 5-14-25
May 15, 2025
Lithium Americas Corp.
3260 – 666 Burrard Street
Vancouver, British Columbia V6C 2X8
Canada
Dear Sirs/Mesdames:
| Re: | Lithium Americas Corp. – Registration Statement on Form S-3 |
We have acted as British Columbia counsel to Lithium Americas Corp. (the “Company”) in connection with the preparation of a Registration Statement on Form S-3 dated May 15, 2025 (the “Registration Statement”) under the United States Securities Act of 1933, as amended (the “Act”), relating to the potential issuance and sale of:
| (a) | by the Company, from time to time, pursuant to Rule 415 under the Act, of up to $1,000,000,000 of: |
| (i) | common shares, no par value (“Common Shares”) of the Company (the “Offered Shares”); and |
| (ii) | voting preferred shares and/or non-voting preferred shares of the Company (collectively, the “Preferred Shares”); |
| (b) | by the selling shareholder named in the Registration Statement (the “Selling Shareholder”) of up to 43,707,080 Common Shares (the “Resale Shares”); and |
| (c) | by the Company, Common Shares having an aggregate offering price of up to $100,000,000 pursuant to an equity distribution agreement (the “ATM Shares” and such agreement, the “Distribution Agreement”) |
(collectively, the “Securities”) pursuant to one or more prospectuses (each, a “Prospectus”) included in the Registration Statement.
We have examined originals or copies, certified or otherwise identified to our satisfaction of such documents and considered such questions of law as we considered necessary as a basis for our opinion, including the Registration Statement and resolutions of the board of directors of the Company approving the filing of the Registration Statement and matters relating thereto. In all such examinations, we have assumed (i) the genuineness of all signatures, the legal capacity of all individuals signing any documents, the authenticity of all documents submitted to us as originals, the conformity to authentic original documents of all documents submitted to us as copies, whether facsimile, photostatic, electronic, certified or otherwise, and (ii) the truthfulness of all facts set forth in the public records and in certificates of public officials.
May 15, 2025
Page 2
We have also assumed that in connection with any Securities issued under the Registration Statement, (i) all required filings relating to, and any approvals for, the Registration Statement, any Prospectus or any related document has been made and received prior to the issuance of any such Securities, (ii) any applicable agreement including any debt indenture, subscription receipt agreement, warrant indenture, underwriting agreement or similar document (collectively, “Applicable Agreements”), has been, or will be prior to the time of the issuance of the applicable Security, duly authorized, executed and delivered by the Company and any other party thereto and is enforceable against each such party thereto, and neither the execution and delivery of any such document by any party thereto nor the performance by any party of its obligations thereunder do, or will, violate or conflict with any applicable laws or the constating documents of such party or any requirement or restriction imposed by any court or governmental body having jurisdiction over such party.
Our opinion herein is limited to the laws of the Province of British Columbia and the federal laws of Canada applicable therein now in effect on the date hereof (the “Applicable Law”).
Based on and subject to the foregoing assumptions and qualifications, we are of the opinion that:
| 1. | With respect to the issuance of any Offered Shares which may be offered pursuant to the Registration Statement, when (i) the issuance and sale of the Offered Shares has been duly authorized by all necessary corporate action in conformity with the constating documents (as then in effect), and the Business Corporations Act (British Columbia) (the “BCBCA”) (as then in effect), and does not violate any Applicable Law or result in a default under or breach of any agreement or instrument binding upon the Company and comply with any requirement or restriction imposed by any court or governmental body of Canada or British Columbia having jurisdiction over the Company; (ii) the full consideration, determined to be adequate by the Company’s board of directors (or a duly authorized committee thereof), which is at least equal to the issue price of the Offered Shares, has been received by the Company; and (iii) if certificated, the certificates representing the Offered Shares have been duly executed and delivered by the proper officers of the Company to the purchasers thereof against payment of the agreed-upon consideration therefor in the manner contemplated in the Registration Statement or any Prospectus relating thereto, the Offered Shares will be validly issued, fully paid and non-assessable. |
| 2. | With respect to the issuance of any Preferred Shares which may be offered pursuant to the Registration Statement, when (i) the issuance and sale of the Preferred Shares has been duly authorized by all necessary corporate action in conformity with the constating documents (as then in effect), and the BCBCA (as then in effect), and does not violate any Applicable Law or result in a default under or breach of any agreement or instrument binding upon the Company and comply with any requirement or restriction imposed by any court or governmental body of Canada or British Columbia having jurisdiction over the Company; (ii) the full consideration, determined to be adequate by the Company’s board of directors (or a duly authorized committee thereof), which is at least equal to the issue price of the Preferred Shares, has been received by the Company; and (iii) if certificated, |
May 15, 2025
Page 3
| the certificates representing the Preferred Shares have been duly executed and delivered by the proper officers of the Company to purchasers thereof against payment of the agreed-upon consideration therefor in the manner contemplated in the Registration Statement or any Prospectus relating thereto, the Preferred Shares will be validly issued, fully paid and non-assessable. |
| 3. | With respect to the issuance of any Resale Shares which may be offered pursuant to the Registration Statement, when (i) the full consideration, determined to be adequate by the Company’s board of directors (or a duly authorized committee thereof), which is at least equal to the issue price of the Resale Shares, has been received by the Company; (ii) the Resale Shares are issued by the Company upon conversion of the Convertible Note in accordance with the terms of the Convertible Note; and (iii) if certificated, the certificates representing the Resale Shares have been duly executed and delivered by the proper officers of the Company to purchasers thereof against payment of the agreed-upon consideration therefor in the manner contemplated in the Registration Statement or any Prospectus relating thereto, the Resale Shares will be validly issued, fully paid and non-assessable. |
| 4. | With respect to the issuance of any ATM Shares which may be offered pursuant to the Registration Statement, when (i) the full consideration, in cash, which is at least equal to the issue price of the ATM Shares, has been received by the Company; and (iii) if certificated, the certificates representing the ATM Shares have been duly executed and delivered by the proper officers of the Company to purchasers thereof against payment of the agreed-upon consideration therefor in the manner contemplated in the Distribution Agreement, the ATM Shares will be validly issued, fully paid and non-assessable. |
We hereby consent to the use of our name in, and the filing of this opinion as an exhibit to, the Registration Statement. In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under the Act. This opinion is expressed as at the date hereof and we disclaim any undertaking or obligation to advise you of any subsequent changes of the facts stated or assumed herein or any subsequent changes in Applicable Law.
Yours truly,
/s/ Cassels Brock & Blackwell LLP
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We hereby consent to the incorporation by reference in this registration statement on Form S-3 of Lithium Americas Corp. (formerly 1397468 B.C. Ltd.) of our report dated March 28, 2025 relating to the financial statements of Lithium Americas Corp., which appears in Lithium Americas Corp.’s Annual Report on Form 10-K for the year ended December 31, 2024. We also consent to the references to us under the headings “Experts” in such registration statement.
/s/PricewaterhouseCoopers LLP
Chartered Professional Accountants
Vancouver, Canada
May 15, 2025
Exhibit 23.2
CONSENT OF QUALIFIED THIRD-PARTY FIRM
SAWTOOTH MINING LLC
May 15, 2025
Re: Form S-3 to be filed by Lithium Americas Corp. (the “Company”)
I, Guy Guidinger, on behalf of Sawtooth Mining LLC, consent to:
| • | the use of and reference to our company name, including our status as an expert or “qualified person” (as defined in Subpart 1300 of Regulation S-K promulgated by the U.S. Securities Exchange Commission (the “SEC”)), in connection with the Company’s Registration Statement on Form S-3 filed with the SEC, and any amendments or supplements thereto (the “Form S-3”), the technical report titled “S-K 1300 Technical Report Summary on the Thacker Pass Project Humboldt County, Nevada, USA” dated December 31, 2024 (the “1300 Report”), and the technical report titled “NI 43-101 Technical Report on the Thacker Pass Project, Humboldt County, Nevada, USA” dated December 31, 2024 (the “43-101 Report” and, together with the 1300 Report, the “Technical Reports”); and |
| • | the use of any extracts from, or summary of, the Technical Reports included or incorporated by reference in the Form S-3 and the use of any information derived, summarized, quoted or referenced from the Technical Reports, or portions thereof, that was prepared by us, that we supervised the preparation of, and/or that was reviewed and approved by us, that is included or incorporated by reference in the Form S-3. |
We are responsible for authoring, and this consent pertains to, Sections 3, 4, 5, 6, 7.1, 7.2, 7.4.1, 8, 9.1.1, 9.2, 9.3, 11, 12, 13, 18.1.4, 20 and 21.1 and corresponding sections of 1, 2, 9.4, 18.1.1, 18.2.1, 18.2.2, 18.3.1, 22, 23, 24 and 25 of the 1300 Report, and Sections 4, 5, 6, 7, 8, 9, 10, 11, 12.2 to 12.7, 14, 15, 16, 21.1.4, 23, and 24.1, and corresponding sections of 1, 2, 3, 12.1.1, 12.8, 21.1.1, 21.2.1, 21.2.2, 21.3.1, 25, 26 and 27 of the 43-101 Report. We certify that we have read the descriptions of the Technical Reports in the Form S-3 and the documents incorporated by reference therein and that they fairly and accurately represent the information in the Technical Reports for which we are responsible.
| Sawtooth Mining LLC | ||
| By: | /s/ Guy Guidinger | |
| Name: | Guy Guidinger | |
| Title: | President | |
Exhibit 23.3
CONSENT OF QUALIFIED THIRD-PARTY FIRM
EXP U.S. SERVICES INC.
May 15, 2025
Re: Form S-3 to be filed by Lithium Americas Corp. (the “Company”)
I, Walter Mutler, P.Eng., on behalf of EXP U.S. Services Inc., consent to:
| • | the use of and reference to our company name, including our status as an expert or “qualified person” (as defined in Subpart 1300 of Regulation S-K promulgated by the U.S. Securities Exchange Commission (the “SEC”)), in connection with the Company’s Registration Statement on Form S-3 filed with the SEC, and any amendments or supplements thereto (the “Form S-3”), the technical report titled “S-K 1300 Technical Report Summary on the Thacker Pass Project Humboldt County, Nevada, USA” dated December 31, 2024 (the “1300 Report”), and the technical report titled “NI 43-101 Technical Report on the Thacker Pass Project, Humboldt County, Nevada, USA” dated December 31, 2024 (the “43-101 Report” and, together with the 1300 Report, the “Technical Reports”); and |
| • | the use of any extracts from, or summary of, the Technical Reports included or incorporated by reference in the Form S-3 and the use of any information derived, summarized, quoted or referenced from the Technical Reports, or portions thereof, that was prepared by us, that we supervised the preparation of, and/or that was reviewed and approved by us, that is included or incorporated by reference in the Form S-3. |
We are responsible for authoring, and this consent pertains to, Sections 9.1.4 and 15.9 and corresponding sections of 1, 2, 9.4, 18.1.1, 18.2.1, 18.3.1, 22, 23, 24 and 25 of the 1300 Report, and Sections 12.1.4, and 12.8, 18.9, 21.1.1 and 21.2.1 and 21.3.1 and corresponding sections of 1, 25, 26 and 27 of the 43-101 Report. We certify that we have read the descriptions of the Technical Reports in the Form S-3 and the documents incorporated by reference therein and that they fairly and accurately represent the information in the Technical Reports for which we are responsible.
| EXP U.S. Services Inc. | ||
| By: | /s/ Walter Mutler | |
| Name: | Walter Mutler, P.Eng. | |
| Title: | Senior Vice President, OG&C Group | |
Exhibit 23.4
CONSENT OF QUALIFIED THIRD-PARTY FIRM
SGS CANADA INC.
May 15, 2025
Re: Form S-3 to be filed by Lithium Americas Corp. (the “Company”)
I, Marc-Antoine Laporte, P.Geo, on behalf of SGS Canada Inc., consent to:
| • | the use of and reference to our company name, including our status as an expert or “qualified person” (as defined in Subpart 1300 of Regulation S-K promulgated by the U.S. Securities Exchange Commission (the “SEC”)), in connection with the Company’s Registration Statement on Form S-3 filed with the SEC, and any amendments or supplements thereto (the “Form S-3”), the technical report titled “S-K 1300 Technical Report Summary on the Thacker Pass Project Humboldt County, Nevada, USA” dated December 31, 2024 (the “1300 Report”), and the technical report titled “NI 43-101 Technical Report on the Thacker Pass Project, Humboldt County, Nevada, USA” dated December 31, 2024 (the “43-101 Report” and, together with the 1300 Report, the “Technical Reports”); and |
| • | the use of any extracts from, or summary of, the Technical Reports included or incorporated by reference in the Form S-3 and the use of any information derived, summarized, quoted or referenced from the Technical Reports, or portions thereof, that was prepared by us, that we supervised the preparation of, and/or that was reviewed and approved by us, that is included or incorporated by reference in the Form S-3. |
We are responsible for authoring, and this consent pertains to, Sections 9.1.3, 10, 14, 15.1 to 15.8, 15.10.1 to 15.10.6, 15.13 to 15.15, 16, 18 (except for 18.1.4 and 18.2.3) and 19 and corresponding sections of 1, 2, 9.4, 22, 23, 24 and 25 of the 1300 Report, and Sections 1.15, 1.16, 1.17, parts of 1.18, 12.1.3, parts of 12.8, 13, 17, 18.1-18.8, 18.10.1-18.10.6, 18.13, 18.14, 18.15, 19, 21 except for 21.1.4 and 21.1.5, 22, and parts of 25 and 26 and corresponding sections 1, 2, 3, 19, 21, 22, 25 and 26 of the 43-101 Report. We certify that we have read the descriptions of the Technical Reports in the Form S-3 and the documents incorporated by reference therein and that they fairly and accurately represent the information in the Technical Reports for which we are responsible.
| SGS Canada Inc. | ||
| By: | /s/ Marc-Antione Laporte | |
| Name: | Marc-Antoine Laporte, P.Geo | |
| Title: | Global Business Manager | |
Exhibit 23.5
CONSENT OF QUALIFIED THIRD-PARTY FIRM
NEWFIELDS MINING DESIGN & TECHNICAL SERVICES
May 15, 2025
Re: Form S-3 to be filed by Lithium Americas Corp. (the “Company”)
I, Paul Kaplan, P.E., on behalf of NewFields Mining Design & Technical Services, consent to:
| • | the use of and reference to our company name, including our status as an expert or “qualified person” (as defined in Subpart 1300 of Regulation S-K promulgated by the U.S. Securities Exchange Commission (the “SEC”)), in connection with the Company’s Registration Statement on Form S-3 filed with the SEC, and any amendments or supplements thereto (the “Form S-3”), the technical report titled “S-K 1300 Technical Report Summary on the Thacker Pass Project Humboldt County, Nevada, USA” dated December 31, 2024 (the “1300 Report”), and the technical report titled “NI 43-101 Technical Report on the Thacker Pass Project, Humboldt County, Nevada, USA” dated December 31, 2024 (the “43-101 Report” and, together with the 1300 Report, the “Technical Reports”); and |
| • | the use of any extracts from, or summary of, the Technical Reports included or incorporated by reference in the Form S-3 and the use of any information derived, summarized, quoted or referenced from the Technical Reports, or portions thereof, that was prepared by us, that we supervised the preparation of, and/or that was reviewed and approved by us, that is included or incorporated by reference in the Form S-3. |
We are responsible for authoring, and this consent pertains to, Sections 7.3, 7.4.2, 9.1.2, 10.2.7, 15.10.7, 15.11, 15.12, 17 and 18.2.3 and corresponding sections of 1, 2, 9.4, 22, 23, 24 and 25 of the 1300 Report, and Sections 12.1.2 and 12.8, 18.10.7, 18.11 and 18.12, all of 20 and 21.2.3 along with corresponding sections of 1, 25 and 26 of the 43-101 Report. We certify that we have read the descriptions of the Technical Reports in the relevant sections of the Form S-3 and the documents incorporated by reference therein and that they fairly and accurately represent the information in the Technical Reports for which we are responsible.
| NewFields Mining Design & Technical Services | ||
| By: | /s/ Paul Kaplan | |
| Name: | Paul Kaplan, P.E. | |
| Title: | Principal | |