Nano One Materials Corp, a process technology company specializing in lithium-ion battery cathode active materials, has entered into definitive agreements for the sale and lease back of its Candiac building and surrounding property at 280 Liberté Avenue, Candiac, Québec to Candiac Industrial Properties.
The deal is for an estimated net proceeds of C$15.7 million, Nano One said this morning. The transaction significantly strengthens Nano One’s cash balance while ensuring long-term operational stability in the province of Québec through a 15-year lease agreement with renewal provisions for up to an additional 15 years.
Nano One’s technology applications can be used within stationary energy storage systems (ESS), portable electronics, and electric vehicles (EVs). Its patented One-Pot process reduces costs, is easier-to permit, lowers energy intensity, environmental footprint, and reliance on problematic supply chains.
Carlo Valente, CFO of Nano One, said:
“This transaction bolsters our balance sheet and helps leverage over C$40 million in government funding and reimbursements that we secured and announced last year. It also accelerates the commercialization and capacity expansion of the Candiac operations to at least 1000 tpa of LFP cathode production.”
With Nano One’s balance sheet now strengthened, the company looks well positioned to advance its commercialization and technology licensing efforts with its strategic partners. The funds also enable it to scale up operations in Candiac and push towards revenue generation from future LFP production and licensing.
Fifteen year lease term for Candiac property
The agreements are expected to close on or about February 28, 2025 and include a vendor loan of C$2 million that is a deferred payment and secured by an immovable hypothec, safeguarding Nano One’s interests.
The transaction costs and a lease security deposit are estimated at C$1.3 million, resulting in estimated net proceeds to Nano One at closing of C$13.7 million. The vendor loan incurs interest at 4% per annum and the deferred payment is due $1 million plus interest upon the third anniversary and $1 million plus interest upon the sixth anniversary from the date of closing.
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In addition to the proceeds and pursuant to a capital investment agreement, a separate C$3 million reserve will be funded by Candiac Industrial Properties and held in escrow to fund potential capital improvements, should Candiac deem them necessary subsequent to closing.
Concurrent with closing of the transaction, Nano One will also enter into a lease agreement for the property for an initial term of 15 years, with three optional five-year renewal periods. In addition, Nano One has the right of first offer should Candiac decide to sell in the future. This arrangement provides long-term stability for Nano One’s Candiac operations.
