TORONTO, Dec. 27, 2018 (GLOBE NEWSWIRE) -- Great Lakes Graphite Inc. doing business as NovoCarbon Corporation
(“GLK”, “NovoCarbon” or the “Company” TSX-V:GLK, OTCQB:GLKIF, FWB:8GL) announces
today that the Company has refiled its unaudited interim consolidated financial statements and the MD&A for the three months
ended January 31, 2018 and the three and six months ended April 30, 2018. The Company has also refiled the MD&A for the
nine months ended July 31, 2018.
This filing, news release and the MCR have been filed in connection with a continuous disclosure review
conducted by staff of the Ontario Securities Commission. The MCR was not filed within the prescribed timeframe in accordance
with the requirements of Ontario securities law, and it was subsequently filed as a result of such review.
The Company has restated its financial statements as at and for the three months ended January 31, 2018 to
consolidate the activity of its incorporated subsidiary ‘NovoCarbon Inc.’ Activity in this subsidiary commenced in November
2017. The adjustments noted below record the effect of consolidating results of operations during the three months ended
January 31, 2018, its cash balances and the elimination of applicable intercompany balances. Furthermore, Amounts paid to
related parties in note 14 has been amended to include amounts paid by the subsidiary to the Chief Marketing Officer and the Senior
Vice President of Sales $38,103 and $38,103, respectively, or $76,206 in aggregate.
Additionally, the Company has reclassified its exploration and evaluation assets to exploration and evaluation
assets held-for-sale, reflective of the Company’s decision to sell its Lochaber property.
The Company has amended and restated the management’s discussion and analysis for the three months ended January
31, 2018 to include additional detail on corporate development and administration expense, and additional detail on financial
variances, and additional disclosure with respect to project activity and their ensuing progress.
The impact of this change on the consolidated financial statements as at and for the three months ended January
31, 2018 is as follows;
| |
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As Previously |
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|
|
|
| |
|
|
|
Reported |
|
Adjustment |
|
As Restated |
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
| Statement of Financial Position |
|
|
|
|
|
|
|
| Restricted Cash |
|
|
|
$ |
173,246 |
|
|
$ |
127,584 |
|
|
$ |
300,830 |
|
| Promissory note receivable |
|
|
|
|
406,528 |
|
|
|
(406,528 |
) |
|
|
- |
|
| Convertible note receivable |
|
|
|
|
- |
|
|
|
92,824 |
|
|
|
92,824 |
|
| Total current assets |
|
|
|
|
853,849 |
|
|
|
156,545 |
|
|
|
1,010,394 |
|
| Exploration and evaluation assets |
|
|
|
342,665 |
|
|
|
(342,665 |
) |
|
|
- |
|
| Exploration and evaluation assets held-for-sale |
|
|
- |
|
|
|
342,665 |
|
|
|
342,665 |
|
| Total shareholder deficiency |
|
|
|
|
(5,110,480 |
) |
|
|
(186,120 |
) |
|
|
(5,296,600 |
) |
| Total equity and liabilities |
|
|
|
|
1,196,514 |
|
|
|
(186,120 |
) |
|
|
1,010,394 |
|
| |
|
|
|
|
|
|
|
|
| Statement of Income and Comprehensive
Income |
|
|
|
|
|
| Professional Fees |
|
|
|
$ |
2,383 |
|
|
$ |
25,296 |
|
|
$ |
27,679 |
|
| Management and consulting |
|
|
|
|
268,697 |
|
|
|
120,156 |
|
|
|
388,853 |
|
| Corporate development and administration |
|
|
|
|
52,134 |
|
|
|
34,289 |
|
|
|
86,423 |
|
| Interest and bank charges |
|
|
|
|
(3,364 |
) |
|
|
6,379 |
|
|
|
3,015 |
|
| Net loss and comprehensive loss |
|
|
|
|
(1,670,916 |
) |
|
|
(186,120 |
) |
|
|
(1,857,036 |
) |
| |
|
|
|
|
|
|
|
|
| Statement of Cash Flows |
|
|
|
|
|
|
|
|
| Net loss for the period |
|
|
|
$ |
(1,670,916 |
) |
|
$ |
(186,120 |
) |
|
$ |
(1,857,036 |
) |
| Restricted cash |
|
|
|
|
(152,096 |
) |
|
|
(127,584 |
) |
|
|
(279,680 |
) |
| Cash used in operating activities |
|
|
|
|
(1,791,566 |
) |
|
|
(186,120 |
) |
|
|
(1,977,686 |
) |
| Debenture receivable |
|
|
|
|
(406,528 |
) |
|
|
406,528 |
|
|
|
- |
|
| Convertible note receivable |
|
|
|
|
- |
|
|
|
(92,824 |
) |
|
|
(92,824 |
) |
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
The Company has restated its financial statements as at and for the three and six months ended April 30, 2018 to correct the
presentation in the three months ended April 30, 2018 column statement of loss and comprehensive loss to include the results of
operations of the Company’s wholly owned subsidiary. This change impacts only the net loss and comprehensive loss for the
three months ended April 30, 2018. There is no change in the net loss and comprehensive loss for the six months ended
April 30, 2018.
Additionally, the Company has reclassified its exploration and evaluation assets to exploration and evaluation
assets held-for-sale, reflective of the Company’s decision to sell its Lochaber property.
The Company has amended and restated the management’s discussion and analysis for the six months ended April 30,
2018 to include additional detail on corporate development and administrative expense, and additional detail on financial
variances, and additional disclosure with respect to project activity and their ensuring progress.
The impact of this change on the consolidated financial statements as at and for the three months and six months
ended April 30, 2018 is as follows;
| |
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|
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|
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As Previously |
|
|
|
|
| |
|
|
|
|
|
|
|
Reported |
|
Adjustment |
|
As Restated |
| |
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|
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|
|
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| |
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|
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|
|
|
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|
|
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| Statement of Financial Position, as at April 30,
2018 |
|
|
|
|
|
|
|
|
| Exploration and evaluation assets |
|
|
|
|
|
|
$ |
342,665 |
|
|
$ |
(342,665 |
) |
|
|
- |
|
| Exploration and evaluation assets held-for-sale |
|
|
|
|
|
|
- |
|
|
|
342,665 |
|
|
|
342,665 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three Months Ended |
|
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|
Six Months Ended |
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|
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|
| |
|
April 30, 2018 |
|
|
|
|
|
April 30, 2018 |
|
|
|
|
| |
|
|
|
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|
|
|
|
|
|
|
|
| |
|
As Previously |
|
|
|
|
|
As Previously |
|
|
|
|
| |
|
Reported |
|
Adjustment |
|
As Restated |
|
Reported |
|
Adjustment |
|
As Restated |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Statement of Income and Comprehensive Income |
|
|
|
|
|
|
|
|
| Professional Fees |
|
$ |
93,786 |
|
|
$ |
(25,296 |
) |
|
$ |
68,490 |
|
|
$ |
96,169 |
|
|
|
- |
|
|
$ |
96,169 |
|
| Management and consulting |
|
|
467,279 |
|
|
|
(120,156 |
) |
|
|
347,123 |
|
|
|
735,976 |
|
|
|
- |
|
|
|
735,976 |
|
| Corporate development and administration |
|
|
161,781 |
|
|
|
(34,289 |
) |
|
|
127,492 |
|
|
|
213,915 |
|
|
|
- |
|
|
|
213,915 |
|
| Interest and bank charges |
|
|
1,186 |
|
|
|
626 |
|
|
|
1,812 |
|
|
|
4,827 |
|
|
|
- |
|
|
|
4,827 |
|
| Net loss and comprehensive loss |
|
|
(996,498 |
) |
|
|
186,120 |
|
|
|
(810,378 |
) |
|
|
(2,667,414 |
) |
|
|
- |
|
|
|
(2,667,414 |
) |
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The Company has amended and restated the management’s discussion and analysis for the nine months ended July 31, 2018 to include
additional detail on corporate development and administrative expense, and additional detail on financial variances, and disclosure
with respect to project activity and their ensuing progress.
The Sale of the Company’s Lochaber Project
Further to the news release of February 22, 2018 to announce the term sheet to sell the Lochaber Graphite
Deposit, located in the Buckingham Region of Quebec, to Saint Jean Carbon Inc. (“SJC” TSX-V: SJL), the Company
indicated that shareholder approval was required for the definitive sale agreement of the Lochaber Property. Upon further
analysis and discussion with the Company’s legal counsel, Fogler Rubinoff LLP, it was determined that such shareholder approval was
not required under subsection 184(3) of the Business Corporations Act (Ontario) and proceeded with the sale of Lochaber in
that manner. The Company announced conditional approval of the Lochaber transaction on July 5, 2018 and closed the
transaction on July 19, 2018. As previously announced on May 16, 2018, the adoption of our business plan from the
conventional junior mining approach to focus instead on upgrading graphite and distributing that material, coupled with the sale of
Lochaber will constitute a change of business (Proposed “COB” ) for the Company within the meaning of the policies
of the TSX Venture Exchange (the TSXV Policy 5.2). The Company will hold a shareholder meeting to approve
this change of business. Additional information with respect to the proposed COB and legal analysis regarding the Lochaber
sale will be provided in the management information circular to be prepared and delivered to shareholders in connection with the
Meeting. The Meeting date has not been determined but will be communicated once it has been scheduled.
Other
The Company announces that it has filed material change reports on December 27, 2018 (the
“MCR”) in respect of certain developments, such developments consisting of the following;
- Debt Financing previously announced on November 10, 2017 as a material contract
- Articles of Incorporation and corresponding By-Laws of the Company
- Articles of Incorporation of NovoCarbon Inc (100% owned US subsidiary)
- Intercompany note to NovoCarbon Inc.
- To identify the change of the Lochaber property in Quebec from a significant asset to an insignificant asset of the Company
as a result of progress of sales and marketing initiatives and developments announced in news releases dating back to May 26,
2016.
About NovoCarbon Corporation: NovoCarbon is a Clean Technology Minerals Processing Company
supplying customers with innovative, high quality value-added carbon products.
There is no significant graphite production in North America now. As pricing and demand continue to rise,
NovoCarbon is one of the first new domestic suppliers to a growing regional customer base. We continually work to deliver products
of the best quality with outstanding customer service.
The Company is party to an agreement for long-term supply of high quality natural graphite concentrate from
Brazil. NovoCarbon is presently working with an established US-based processor for toll micronization services. The Company has
partnered with Ashland Advanced Materials for commercial-scale purification operations at Ashland’s 110,000 square foot
purification facility located in Niagara, New York.
Through our partner relationships, NovoCarbon began selling micronized synthetic graphite beginning in 2016 and
now supplies micronized and high purity micronized natural flake graphite products to a growing customer base.
Further information regarding NovoCarbon can be found on the Company’s website at: www.novocarbon.com
NovoCarbon trades as GLKIF on the OTCQB market in the US and as GLK on the TSX Venture Exchange in Canada.
There are currently 132,656,830 shares outstanding. The current legal name of the corporation is Great Lakes Graphite Inc.,
which is doing business as NovoCarbon Corporation until final approval by the shareholders and the TSX Venture Exchange.
For more information, please contact:
Paul Gorman
Chief Executive Officer
Email: pgorman@greatlakesgraphite.com
Susan Murphy
Manager, Administration
Email: smurphy@greatlakesgraphite.com
1-800-754-4510 x101
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Caution Regarding Forward Looking Information: Certain statements in this press release may
constitute "forward looking information" which involves known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of the Company to be materially different from any future results, performance or
achievements expressed or implied by such forward looking information. When used in this press release, such forward looking
information may use such words as "may'', "will'', "expect'', "believe'', "plan'' and other similar terminology. Forward looking
information is provided for the purpose of presenting information about management's current expectations relating to the future
events and the operating performance of the Company, and readers are cautioned that such information may not be appropriate for
other purposes. The forward looking statements involve a number of risks and uncertainties. These risks and uncertainties include,
but are not limited to, the ability of the Company to fulfill the orders and future orders, regulatory requirements, general
economic, market or business conditions and future developments in the sectors of the economy in which the business of Great Lakes
operates. The foregoing list of factors is not exhaustive. Please see the Company's financial statements, MD&A and other
documents available on www.sedar.com , for a more detailed description of the risk factors. The Company undertakes no obligation to
update publicly or revise any forward looking information, whether a result of new information, future results or otherwise, except
as required by law.
