viewNioCorp Developments Ltd.

NioCorp completes convertible security funding deal of up to US $10.5mln

The Canadian company has signed a definitive deal with an entity managed by The Lind Partners.

NioCorp is developing the Elk Creek Niobium / Scandium / Titanium project in Southeast Nebraska.

NioCorp Developments (TSE:NB) (OTCMKTS:NIOBF), a Canada-based mineral development company, completed and signed a definitive convertible security funding agreement with an entity managed by The Lind Partners, a New York based asset management firm.

An initial US$4.5mln will be funded pursuant to the issuance of an initial convertible security, which is expected to occur on or around December 24, the Entennial, Colorado-based company said in a statement on Tuesday.

US$1.5mln of the first tranche will be held in escrow pending certain conditions required to be satisfied by December 31.
Lind can increase the funding under the convertible security by an additional US$1.0mln during its two-year term.

Further, provided certain conditions are met, NioCorp will have the right to call an additional US$ 1.0mln under the funding agreement.

The agreement also provides for the issuance of a second convertible security on mutual agreement of the company and Lind, in which Lind would fund up to another US$6.0mln, which can also be increased by US$1.0mln.

"Lind's funding will help them complete the bankable feasibility study, the results of which will be key to unlocking the value of this project. We look forward to seeing the results of the BFS soon," Phillip Valliere, a Managing Director at The Lind Partners, said in the statement.

"This funding will move us further along toward completion of a bankable feasibility study for our Elk Creek project, which will then help to set the stage for us to acquire project financing and begin construction of our mine and processing facility in Nebraska," Mark Smith, NioCorp's Executive Chairman, was quoted as saying.

Each convertible security has a two-year term from the date of issue and will incur a simple interest rate obligation of 10% on the amount funded that is prepaid and attributed to its face value upon the issuance of each convertible ecurity.

The convertible security is secured by the assets of the company.

The company has agreed to pay a fee of US$135,000 for each of the first tranche and second tranche.

Lind will be entitled to convert the convertible securities in monthly installments over the term, and the conversion will be at a price per share of 85% of the five-day trailing volume-weighted average price of the common shares prior to the date that notice of conversion is provided by Lind.

The agreement contains restrictions on how much of the convertible securities may be converted in any particular month.

NioCorp has the option to buy-back up to 70% of the convertible security in cash at any time for a nominal premium.

Lind will also be entitled to accelerate its conversion right to the full amount of the face value or demand repayment of the face value in cash upon a default and other designated events.

NioCorp is developing the Elk Creek Niobium / Scandium / Titanium project in Southeast Nebraska.

Shares were trading down 1.7% at C$0.59 at 12:44 p.m. in Toronto, reversing an earlier increase to as high as C$0.62.

Quick facts: NioCorp Developments Ltd.

Price: 0.76 CAD

Market: TSX
Market Cap: $181.67 m

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