Lucara Diamond Corp. (“Lucara” or the “Company”) is pleased to announce today that it has entered into an agreement with a syndicate of underwriters led by BMO Capital Markets under which the underwriters have agreed to buy on bought deal basis 29,400,000 common shares (the “Common Shares”), at a price of C$ 0.75 per Common Share for gross proceeds of approximately C$22 million (the “Public Offering”). The Company has granted the Underwriters an option, exercisable at the offering price for a period of 30 days following the closing of the Public Offering, to purchase up to an additional 15% of the Public Offering to cover over-allotments, if any. The offering is expected to close on or about July 15, 2021 and is subject to Lucara receiving all necessary regulatory approvals.

The Company is also pleased to announce that it has agreed to launch a concurrent private placement of approximately C$16 million on the same terms as the Public Offering (the “Private Placement” and together with the Public Offering, the “Financing”) to Nemesia S.à.r.l. (“Nemesia”) and to certain other investors on a private placement basis. Any Common Shares issued pursuant to the Private Placement will be subject to a statutory hold period in Canada for a period of 4 months and one day. The Private Placement is expected to close on or about July 15, 2021 and is subject to Lucara receiving all necessary regulatory approvals.

The net proceeds of the Public Offering and Private Placement will be used for working capital to support the development and ongoing operation of the Karowe diamond mine.

In respect of the Public Offering, Common Shares will be offered by way of a short form prospectus in British Columbia, Alberta, Manitoba and Ontario and may also be offered by way of private placement in the United States.

The securities offered have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Nemesia is an insider of the Company and, as a result of their participation in the Private Placement, the Private Placement will be considered a “related party transaction” under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company intends to rely on the exemptions set forth in sections 5.5(a) and 5.7(1)(a) of MI 61-101 from the valuation and minority shareholder approval requirements of MI 61-101 in respect of such insider participation, as neither the aggregate fair market value of the Common Shares expected to be purchased by Nemesia is less than 25% of the Company’s market capitalization. A material change report in respect of the Financing will be filed in accordance with MI 61-101, but is not expected to be filed 21 days in advance of the closing of the Financing as certain details regarding the participation of Nemesia have not yet been finalized and the Company wishes to close on an expedited basis for sound business reasons.

This news release is not an offer to the public to subscribe for Common Shares or otherwise acquire Common Shares or other financial instruments in the Company, whether in Sweden or in any other EEA Member State. This news release is an advertisement and does not constitute a prospectus in accordance within the meaning of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (the “Prospectus Regulation”). No such prospectus has been or will be prepared in connection with the Offering or the Private Placement. The financial instruments referred to in the news release are not intended to be offered to the public in any EEA Member State except to qualified investors (as defined in the Prospectus Regulation) and in accordance with any other applicable exemption from the requirement to prepare a prospectus under the Prospectus Regulation in that Member State.

Eira Thomas

President and Chief Executive Officer

In the TV clip below, Lucara’s CEO Eira Thomas explains the business, including the deal with Louis Vuitton and tells us more about Clara, Lucara’s wholly owned digital sales platform