Neo Lithium announces strategic investment by CATL

Neo Lithium Corp., Toronto, Canada, (TSXV: NLC) (OTCQX: NTTHF) (FSE: NE2) has announced that it has entered into an equity subscription agreement with a subsidiary of Contemporary Amperex Technology Ltd. (CATL), a leading Chinese battery manufacturer and technology company that specializes in the manufacturing of lithium-ion batteries for electric vehicles and energy storage systems, and battery management systems.

Under the terms of the Agreement, CATL will subscribe for 10,217,502 common shares of Neo Lithium at a price of C$0.84 per Common Share (the “Issue Price”) for gross proceeds to Neo Lithium of C$8,582,702. The completion of the transaction is subject to the approval of TSX Venture Exchange and customary approval from the government of the People’s Republic of China. In addition, in order to demonstrate their on-going commitment to and belief in the Company and the 3Q Project, certain members of management and the board have committed to subscribe for up to 483,334 common shares of Neo Lithium for gross proceeds of C$406,000, at the same Issue Price (collectively with CATL’s subscription, the “Private Placement”).

This investment will strengthen Neo Lithium’s financial position and financing strategy and get us one step closer to the development and construction of the Company’s wholly owned Tres Quebradas Lithium Project (“3Q Project”) in Catamarca Province, Argentina. The Company completed a positive Pre-Feasibility Study in May 2019 and going forward, the Company together with the technical assistance of CATL, will finish the Definitive Feasibility Study (“DFS”) in order to define the precise financing requirements for the 3Q Project. TheDFS will evaluate the economic feasibility for a project with a nameplate production capacity of approximately 20,000 metric tons of battery quality lithium carbonate, with expansion capacity up to 40,000 metric tons per year of battery quality lithium carbonate.

Waldo Perez, Chief Executive Officer and Director of Neo Lithium, commented, “We are delighted to receive an endorsement from a globally recognized, leading industry player such as CATL as we continue to further advance our strategic objectives at the 3Q Project. As we have said many times, we believe it’s extremely important to have a strategic partner with unique knowledge of the expected end market demand, before concluding the DFS. We are confident that CATL will help us define the battery grade quality and certification of the final product to highest levels.”

Changdong Li (李长东), Representative of the Chairman in respect of resource procurement of CATL, commented, “CATL is very pleased to complete this strategic investment in Neo Lithium.  We believe that the 3Q Project is an attractive development project that may benefit from our expertise and know-how in the battery manufacturing and technology space.”

Over the past few months, the Company has provided several corporate updates regarding the process to select a strategic and financing partner. Since then and recognizing that over the past months the pandemic has affected Project Financing activities globally in the lithium industry and others, the Company has decided to move forward with the DFS with the assistance of a  global industry leader, which will help us minimize the technical risks and adapt the project to meet the best industry standards in terms of quality and specifications.

Constantine Karayannopoulos, Vice Chairman of Neo Lithium commented, “We are thrilled to welcome CATL as a strategic investor in Neo Lithium and to have them join our share register alongside many of our other long-term supportive shareholders. The investment by CATL, which comes at a premium to market price, is a positive sign of support for the 3Q Project and our management team. CATL is a large and well respected leader in the battery space with extensive experience, which bodes extremely well as our team continues to forge ahead.”

About CATL

CATL is a global leader in the development and manufacturing of lithium-ion batteries, with businesses covering R&D, manufacturing and sales in battery systems for new energy vehicles and energy storage systems. In 2019, the company’s EV battery sales volume reached 40.25 GWh worldwide, and making it the world leader in annual EV battery consumption volume (source SNE Research).

Headquartered in Ningde, China, CATL has more than 26,000 employees around the world as of 2019  and subsidiaries in Beijing, Liyang (Jiangsu Province), Xining (Qinghai Province) and Yibin (Sichuan Province), as well as in Munich (Germany), Paris (France)Yokohama (Japan), Detroit (USA) and Vancouver (Canada). In addition, the company owns and operates battery manufacturing facilities in FujianJiangsuQinghai and Sichuan provinces, and in its European plant located in Erfurt, Germany, its first overseas plant that is currently under construction. In June 2018, the company went public on the Shenzhen Stock Exchange with stock code 300750.

About Neo Lithium Corp.

Neo Lithium Corp. has quickly become a prominent new name in lithium brine exploration by virtue of its high quality 3Q Project and experienced team. Neo Lithium is rapidly advancing its recently discovered 3Q Project – a unique high-grade lithium brine lake and salar complex in Latin America’s “Lithium Triangle”.

The 3Q Project is located in the Catamarca Province, the largest lithium producing area in Argentina covering approximately 35,000 ha including a salar complex of approximately 16,000 ha.