Alabama Graphite arranges $1.02M private placement

Sep 16, 2016

ALABAMA GRAPHITE CORP. ANNOUNCES PROPOSED NON-BROKERED PRIVATE PLACEMENT

Alabama Graphite Corp. is proposing to complete a non-brokered private placement of up to approximately 6,833,333 units at a subscription price of 15 cents per unit for aggregate gross proceeds to the company of up to approximately $1,025,000. Each unit comprised one common share in the capital of the company and one common share purchase warrant. Each warrant entitles the holder to purchase one additional common share at an exercise price of 20 cents for a period of 24 months following the date of issue, subject to customary adjustment provisions.

AGC intends to use the net proceeds of the private placement for working capital and further advancing the company’s development of its metallurgical process for producing coated spherical purified graphite (CSPG) for use in lithium-ion batteries.

The company will not be paying any agent or broker commissions, or finders’ fees in connection with the private placement.

Multiple insiders of the company have indicated their support for the private placement. Any such participation would be a related party transaction under Multilateral Instrument 61-101 — Protection of Minority Security Holders in Special Transactions, but will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of the subject matter of the transaction nor the consideration paid will exceed 25 per cent of the company’s market capitalization. The private placement was approved by all of the independent directors of the company.

The number of common shares potentially issuable to insiders of the company pursuant to the private placement (including any common shares issuable upon the exercise of the warrants) will represent not more than 10 per cent of the company’s currently issued and outstanding common shares on a non-diluted basis.

The closing of the private placement is subject to the conditional and final approval of the TSX Venture Exchange. The company intends to close the private placement in one tranche and as soon as practicable, subject to receipt of all necessary regulatory approvals. All securities issued pursuant to the private placement will be subject to, among other things, a hold period of four months and one day in accordance with applicable Canadian securities laws.

Qualified person

Donald K.D. Baxter, PEng, president, chief executive officer and executive director of Alabama Graphite, is a qualified person as defined by National Instrument 43-101 guidelines, and has reviewed and approved the content of this news release.

About Alabama Graphite

Alabama Graphite is a Canadian-based flake graphite exploration and development company as well as an aspiring battery materials production and technology company. The company operates through its wholly owned subsidiary, Alabama Graphite Company Inc. (a company registered in the state of Alabama). With an advancing flake graphite project in the United States of America, Alabama Graphite intends to become a reliable, long-term U.S. supplier of specialty high-purity graphite products.

http://alabamagraphite.com/news-releases-2016/