NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES
OR FOR DISSEMINATION IN THE UNITED STATES
VANCOUVER, CANADA – GoviEx Uranium Inc. (TSX-V: GXU; OTCQB: GVXXF) (“GoviEx” or “Company”) today announced it is undertaking a private placement of up to C$5,000,000 (the “Private Placement”). The Company will be offering up to approximately 20,000,000 units
(“Units”) at a price of C$0.25 per Unit, with each Unit consisting of one (1) Class A common share and one (1) Class A common share purchase warrant (a “Warrant”) of the Company.
Each Warrant shall entitle the holder to purchase one Class A common share of the Company for a period of 24 months at the United States dollar (“US$”) equivalent of C$0.35 per share, for a period of 12 months following the closing date of the Private Placement and at the US$
equivalent of C$0.40 per share for the subsequent period of 12 months. The US$ to C$ exchange rate for the Warrant exercise price will be the daily exchange rate posted on the Bank of Canada’s website for the business day prior to the closing date of the Private Placement.
A cash finder’s fee of 5% may be payable on all, or a portion, of the Private Placement.The Private Placement is expected to close on or before Friday, December 22, 2017.
GoviEx today also announced that Toshiba Corporation (“Toshiba”) has agreed to extend an early redemption right under the uranium loan Tranche B Bond to February 28, 2018. The extension has been granted in order to provide GoviEx the necessary time to resolve the terms
of the Tranche B Bond. GoviEx will make a further announcement regarding the Tranche B Bond as and when appropriate or required.
Completion of the Private Placement will be subject to regulatory approvals, including the approval of the TSX Venture Exchange, and certain other customary conditions including, but not limited to, execution of subscription agreements between the Company and the subscribers.
The net proceeds from the Private Placement will be used to continue exploration and development activities on the Company’s mineral assets, and for general working capital and corporate purposes. The funds may also be used in connection with the potential resolution of
the Toshiba B Bond.
All securities issued under this Private Placement will be subject to a hold period of four months plus one day from the date of issue.
About GoviEx Uranium
GoviEx is a mineral resource company focused on the exploration and development of uranium properties in Africa. GoviEx’s principal objective is to become a significant uranium producer through the continued exploration and development of its flagship mine-permitted Madaouela Project in Niger, its mine-permitted Mutanga Project in Zambia, and its other uranium properties in Africa.
About Tranche B Bond (Uranium Loan)
Pursuant to a bond purchase agreement with Toshiba Corporation (“Toshiba”) in April 2012, the Company borrowed 200,000 pounds of uranium concentrate U3O8 (“Uranium Loan”) at an interest rate of 12% compounded annually. The Uranium Loan matures on April 19, 2020,
subject to early redemption by Toshiba. The principal and interest are stated in pounds of U3O8, and at maturity the Company will have to repay Toshiba a total of 495,193 pounds of U3O8, including interest accrued.
As at September 30, 2017, the Uranium Loan, including accrued interest, totalled 371,619 pounds of U3O8. The Uranium Loan is secured by a floating charge on all Nigerien assets of the Company. Toshiba has the right to demand repayment of the Uranium Loan and accrued
interest if (i) the Company fails to deliver a definitive feasibility study relating to Madaouela Project prior to February 28, 2018, or (ii) the sum of the production and capital costs per pound of U3O8, as estimated in a feasibility study prepared in respect of the Madaouela Project, is not
lower than $44 per pound.