Nemaska Lithium Inc
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NEMASKA LITHIUM INC. ANNUAL INFORMATION FORM FOR THE FISCAL YEAR ENDED JUNE 30, 2019 Issue Date: September 30, 2019 TABLE OF CONTENTS 1. PRELIMINARY COMMENTS AND FORWARD-LOOKING STATEMENTS ......................................... 2 2. CORPORATE STRUCTURE ......................................................................................................................... 2 2.1 NAME, ADDRESS AND INCORPORATION ................................................................................... 2 2.2 INTERCORPORATE RELATIONSHIPS ........................................................................................... 2 3. GENERAL DEVELOPMENT OF THE BUSINESS ..................................................................................... 4 3.1 THREE-YEARS HISTORY ................................................................................................................. 4 3.2 FISCAL YEAR ENDED JUNE 30, 2017 ............................................................................................. 9 3.3 FISCAL YEAR ENDED JUNE 30, 2018 ........................................................................................... 10 3.4 FISCAL YEAR ENDED JUNE 30, 2019 AND UP TO THE DATE OF THIS ANNUAL INFORMATION FORM .................................................................................................................... 14 4. DESCRIPTION OF THE BUSINESS .......................................................................................................... 22 4.1 GENERAL .......................................................................................................................................... 22 4.2 DESCRIPTION OF THE MINERAL PROPERTIES ........................................................................ 23 4.3 RISK FACTORS ................................................................................................................................ 73 5. DIVIDENDS AND DIVIDENDS POLICY ................................................................................................. 94 6. GENERAL DESCRIPTION OF THE CAPITAL STRUCTURE ................................................................ 94 6.1 COMMON SHARES .......................................................................................................................... 94 6.2 STOCK OPTIONS ISSUED UNDER THE STOCK OPTION PLAN .............................................. 94 7. MARKET FOR SECURITIES ...................................................................................................................... 99 7.1 MARKET ............................................................................................................................................ 99 7.2 TRADING PRICE AND VOLUME ................................................................................................... 99 8. DIRECTORS AND OFFICERS ................................................................................................................. 100 8.1 NAME, OCCUPATION AND SECURITIES HOLDING ............................................................... 100 8.2 CEASE TRADE ORDERS, BANKRUPTCIES, PENALTIES OR SANCTIONS .......................... 104 9. LEGAL PROCEEDINGS AND REGULATORY ACTIONS ................................................................... 106 10. AUDIT & RISK COMMITTEE ................................................................................................................. 107 10.1 THE AUDIT & RISK COMMITTEE’S CHARTER ....................................................................... 107 10.2 COMPOSITION OF THE AUDIT & RISK COMMITTEE ............................................................ 107 10.3 RELEVANT EDUCATION AND EXPERIENCE .......................................................................... 107 10.4 AUDIT & RISK COMMITTEE OVERSIGHT ................................................................................ 109 10.5 RELIANCE ON CERTAIN EXEMPTIONS.................................................................................... 109 10.6 PRE-APPROVAL POLICIES AND PROCEDURES ...................................................................... 109 10.7 EXTERNAL AUDITOR SERVICE FEES ....................................................................................... 109 11. TRANSFER AGENT AND REGISTRAR ................................................................................................. 109 12. INTERESTS OF EXPERTS ....................................................................................................................... 110 13. MATERIAL CONTRACTS ....................................................................................................................... 110 14. ADDITIONAL INFORMATION ............................................................................................................... 111 1. PRELIMINARY COMMENTS AND FORWARD-LOOKING STATEMENTS The information in this Annual Information Form is dated as at June 30, 2019, unless indicated otherwise. All dollar amounts in this Annual Information Form refer to Canadian dollars, unless otherwise indicated. This Annual Information Form may contain or incorporate by reference forward-looking statements about the objectives, plans and strategies of Nemaska Lithium Inc. (the “Corporation”) as well as management’s expectations regarding its future growth, financial position and results of operations, and the Corporation’s activities. These statements are forward-looking because they are based on assumptions about future economic conditions and courses of action that will be undertaken by the Corporation. These statements are subject to a number of risks and uncertainties (please refer to section “Risk Factors”) which may cause actual results to differ materially from those contemplated by the forward-looking statements. While the Corporation believes that the expectations reflected in these forward-looking statements are reasonable, there is no guarantee that such expectations will prove to be accurate and the reader must not unduly rely on them. The forward-looking statements are made on the date of this Annual Information Form and, except if the applicable legislation requires it, the Corporation has no intention of updating them nor does it assume the responsibility to do so. 2. CORPORATE STRUCTURE 2.1 Name, Address and Incorporation The Corporation was incorporated under the Canada Business Corporations Act (the “CBCA”) by articles of incorporation on May 16, 2007 under the name “James B Resources Inc.” and its French version “Ressources James B inc.” On November 5, 2008, the Corporation filed articles of amendment in order to change its name for “Nemaska Exploration Inc.” and its French version “Exploration Nemaska inc.” On November 22, 2011, the Corporation filed articles of amendment in order to change once again its name for “Nemaska Lithium Inc.” and in order to allow the directors of the Corporation to appoint one or more additional directors in accordance with the provisions of subsection 106(8) of the CBCA. On July 1, 2019, the Corporation filed articles of amendment in order to increase the maximum number of directors from seven to nine. The Corporation’s registered office is located at 1000 de la Gauchetière West, Suite 2500, Montréal, Province of Québec, Canada, H3B 0A2. 2.2 Intercorporate Relationships The following corporate chart is a list of the subsidiaries of the Corporation as of the date of this Annual Information Form, indicating their jurisdiction of incorporation. All shares of each subsidiary are held directly by the Corporation. 2 Annual Information Form The Corporation 100% 100% 100% 100% Nemaska Lithium Nemaska Lithium Nemaska Lithium Nemaska Lithium Shawinigan P1P Inc. Innovation Inc. Whabouchi Mine Inc. Transformation Inc. (Canada) (Canada) (Canada) (Canada) All assets of the Corporation and of its subsidiaries are located in the Province of Québec, Canada and, in summary, each corporate entity featured in the above chart has the following main assets: Nemaska Lithium Inc.: intellectual property, computer software & hardware; all shares of the four subsidiaries as well as the investments in Monarch Gold Corporation (TSX: MQR) (OTCMKTS: MRQRF) (FRANKFURT: MR7) and Vision Lithium Inc. (previously ABE Resources Inc.) (TSXV: VLI) (OTC-PINK: ABEPF) (“Vision”); Nemaska Lithium P1P Inc.(“NMX P1P”): equipment, office and lease required to operate an electrochemical demonstration plant located in Shawinigan, Province of Québec, Canada (the “Phase 1 Plant”) and designed to produce high purity lithium hydroxide from spodumene concentrate and lithium sulfate; Nemaska Lithium Whabouchi Mine Inc. (“NMX Whabouchi”): including but not limited to, the mining lease, mining claims, surface usage leases and mineral property, including site preparation, concentrator building/garage/domes infrastructures and related equipment, administrative office trailers and all other additions in order to put the Whabouchi mine and concentrator in operation, being all located in the Eeyou Istchee / James Bay Region in the Province of Québec, Canada (“Whabouchi Property”); Nemaska Lithium Shawinigan Transformation Inc. (“NMX Shawinigan”): including but not limited to, the land and commercial buildings located in Shawinigan, Province of Québec, Canada, including site preparation, permanent administrative office building, infrastructures and equipment and all other additions to be used for the commercial production of lithium salts, relating to the future commercial electrochemical