https://norontresources.com/noront-and-wyloo-metals-enter-into-binding-agreement-for-previously-announced-acquisition-of-noront-for-c1-10-per-share/

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• BHP elects not to exercise its right to match; Support Agreement with BHP terminated
• Improved Wyloo Metals offer of C$1.10 in cash per share represents a 358% premium to Noront’s unaffected closing price on May 21, 2021 and a 47% premium to BHP’s C$0.75 per share offer
• Wyloo Metals’ offer also provides shareholders with the option of retaining some or all of their shares in Noront
• Noront’s Board of Directors unanimously supports transaction with Wyloo Metals

TORONTO and PERTH, Australia, Dec. 22, 2021 (GLOBE NEWSWIRE) — Noront Resources Ltd. (“Noront” or the “Company”) (TSXV: NOT) and Wyloo Metals Pty Ltd (“Wyloo Metals”) are pleased to announce that they have entered into a binding arrangement agreement (the “Arrangement Agreement”), pursuant to which Wyloo Metals has agreed to acquire up to all of the outstanding common shares of the Company (each, a “Common Share”) that it does not already own, directly or indirectly, for cash consideration of C$1.10 per Common Share by way of a statutory plan of arrangement under the Business Corporation Act (Ontario) (the “Arrangement”). This announcement follows the waiver by BHP Western Mining Resources International Pty Ltd (“BHP”) of its right to match, as described below.

Noront’s Board of Directors, on the basis of the unanimous recommendation of Noront’s Special Committee comprised of independent directors, and after receiving advice from its financial and legal advisors, unanimously approved the Arrangement and will recommend that shareholders of Noront vote in favour of the Arrangement.

The cash consideration of C$1.10 per Common Share offered under the Arrangement represents an approximate 358% premium to the unaffected closing price of the Common Shares on May 21, 2021 and an approximate 47% premium to the cash offer of C$0.75 per Common Share made by BHP on October 19, 2021.

Alan Coutts, Chief Executive Officer of Noront, commented: “We are pleased to have a binding agreement with Wyloo Metals. The offer price of C$1.10 per share represents a significant premium to the unaffected price of Noront’s common shares and the improved BHP offer, and a great outcome for the shareholders of Noront following a lengthy process. Noront’s Board of Directors and management wish to thank shareholders for their support and patience over the last several months.”

Luca Giacovazzi, Head of Wyloo Metals, commented: “We are very pleased to have reached an agreement with Noront that provides shareholders with an opportunity to crystallise real and immediate value, alongside an option to participate in the Company’s future. The journey to realise the full potential of the Ring of Fire will require patience, determination and respectful consultation with First Nation communities, federal and provincial governments, and regional stakeholders. We look forward to the work ahead of us.”

BHP will not match Wyloo Metals’ proposal 

BHP has determined not to exercise its right to match the Wyloo Metals’ cash offer of C$1.10 per Common Share and, pursuant to the terms of the support agreement between Noront and BHP, as amended, BHP and Noront have agreed to waive the five business day period to provide for an earlier termination of the support agreement. Accordingly, Noront has terminated the support agreement with BHP and concurrently paid the termination fee owing to BHP.

Details of the Transaction 

The Arrangement, which is not subject to a financing condition, will be implemented by way of a statutory plan of arrangement under the Business Corporations Act(Ontario) and will require the approval of (i) at least two-thirds of the votes cast by the holders of Common Shares, and (ii) a simple majority of the Common Shares held by minority shareholders in accordance with Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”) (together, (i) and (ii) are “Shareholder Approval”).

Noront shareholders holding an aggregate of 10.3% of the Common Shares, on a fully-diluted basis, including certain Noront directors and senior management of Noront, have entered into a voting support agreement with Wyloo Metals under which they have agreed to vote in support of the Arrangement. Together with Wyloo Metals, holders of 45.7% of the Common Shares, on a fully-diluted basis, are supportive of the Arrangement.

A special meeting of the shareholders of Noront will be held no later than March 31, 2022 (the “Special Meeting”) to seek Shareholder Approval of the Arrangement. In addition to Shareholder Approval, the Arrangement is also subject to the receipt of court approval, stock exchange approval and other customary closing conditions for transactions of this nature. The Arrangement is expected to be completed before the end of the first quarter of 2022.

Under the Arrangement Agreement, shareholders of Noront will be given an option of (i) remaining as a shareholder of Noront following the completion of the Arrangement, or (ii) receiving cash consideration of C$1.10 per Common Share for some or all of their Common Shares. In order to receive the cash consideration of C$1.10 per Common Share, shareholders must make an election to sell (a “Sale Election”) all or a portion of their Common Shares to Wyloo Metals. Notwithstanding the foregoing, Wyloo Metals will have an option to acquire all of the Common Shares that it does not already own, directly or indirectly, for C$1.10 per Common Share – including those Common Shares not subject to a Sale Election – if less than 10% of the outstanding Common Shares (excluding Common Shares held by Wyloo Metals and its affiliates) are not subject to a Sale Election.

Wyloo Metals has provided a loan to Noront of up to C$29.38 million (the “Loan”) to finance, among other things, the termination payment of C$17.78 million, which has been paid to BHP, as well as other transaction related costs. The term of the Loan is 12 months from completion of the Wyloo Metals transaction, with interest of 5% per annum payable quarterly in either cash or Common Shares, at the option of Noront and subject to receiving shareholder approval for the payment of interest in Common Shares, and subject to the approval of the TSX Venture Exchange.

Under the terms of the Arrangement Agreement, Wyloo Metals will be entitled to a termination payment of C$26 million (equal to approximately 4% of the total equity value of the transaction based on 100% of Noront’s fully diluted shares outstanding) if the Arrangement Agreement is terminated in certain circumstances.

The Arrangement Agreement, which describes the full particulars of the Arrangement, will be available on SEDAR (www.sedar.com) under Noront’s issuer profile. Additional information regarding the terms of the Arrangement, including the background to the Arrangement, the rationale for the unanimous recommendations of Noront’s Board and Special Committee, and how Noront’s shareholders can participate in and vote at the Special Meeting, will be included in the management information circular for the Special Meeting (the “Circular”). The Circular will also be filed, in due course, on SEDAR (www.sedar.com) under Noront’s issuer profile. Shareholders are urged to read these and other relevant materials when they become available.

The entering into of the Loan between Wyloo Metals and Noront, is considered to be a “related party transaction” for purposes of MI 61-101 as Wyloo Metals has beneficial ownership of, and control or direction over, directly or indirectly, securities of the Company carrying more than 20% of the voting rights attached to all of Noront’s outstanding voting securities. The Company did not file the material change report more than 21 days before the expected completion of the Loan as the details of the Loan were not settled until shortly prior to the announcement of the Loan. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101 for the Loan. The Company is exempt from the formal valuation requirement in section 5.4 of MI 61-101 for the Loan in reliance on section 5.5(b) of MI 61-101 as the Company is not listed on a specified market under MI 61-101. Additionally, the Company is exempt from minority shareholder approval requirement in section 5.6 of MI 61-101 for the Loan in reliance on section 5.7(f) of MI 61-101