Lithium Americas agrees to first draw terms on DOE loan

Executive Summary

• Lithium Americas, together with GM, reached a non‑binding agreement in principle with the U.S. Department of Energy (DOE) to advance the first $435 million draw on the $2.23 billion DOE loan for the Thacker Pass lithium project.
• The DOE will receive a 5% equity warrant and a 5% economic stake in the JV, while also deferring $182 million of debt service over the first five years.
• GM’s offtake agreement is being amended to allow the JV to sell remaining Phase‑1 production to third parties; the JV will post an additional $120 million reserve within 12 months of the draw.

Key Details

• First Draw Amount: $435 million, expected in Q4 2025.
• Total DOE Loan Revised: $2.23 billion (principal $1.97 billion; capitalized construction interest reduced to $256 million).
• Debt Service Deferral: $182 million deferred over the first five years of the loan.
• DOE Equity & Economic Stakes:
• 5% equity warrant on Lithium Americas common shares at $0.01 per share.
• 5% economic stake in the JV via warrants to purchase non‑voting, non‑transferable units at $0.01 per unit.
• Additional Reserve Funding: Lithium Americas will post an extra $120 million to DOE loan reserve accounts within 12 months of the first draw.
• JV Ownership (if DOE exercises full warrants):
• Lithium Americas – 59% economic interest, 62% voting interest.
• GM – 36% economic interest, 38% voting interest.
• DOE – 5% economic interest.
• GM Offtake Amendment: Allows the JV to enter third‑party offtake agreements for Phase 1 volumes not forecasted for GM purchase; GM retains right of first offer on Phase 2 and life‑of‑mine rights after existing contracts expire.
• Call & Put Rights:
• GM has a call right to purchase DOE’s JV warrants/units (or exchange them for common equity) upon substantial completion, subject to price agreement.
• DOE holds a put right allowing it to require GM to buy the DOE’s JV warrants/units at fair market value or convert them into common shares under agreed conversion terms.
• Board Observer: DOE may appoint an observer to JV board meetings while holding warrants or units.
• Loan Terms:
• Interest rate: Long‑dated U.S. Treasury rate + 0% spread; projected construction interest rate lowered to 5.0%.
• Tenor: Approximately 24 years from first draw.
• Advisers: Goldman Sachs & Co. (financial adviser); Vinson & Elkins LLP (U.S. legal counsel); Cassels, Brock & Blackwell LLP (Canadian legal counsel).

Notable Quotes

“We greatly appreciate the support of the administration, General Motors and our partners in advancing this vital world‑class project… Together, we are onshoring large‑scale U.S. lithium production, strengthening America’s supply chain, creating exceptional jobs, and enhancing our long‑term energy security and prosperity.” – Jonathan Evans, President & CEO, Lithium Americas

“We’re confident in the Thacker Pass project, which will reduce U.S. dependence on imported lithium… We are pleased to see it move forward and appreciate the administration’s support as GM continues to build a secure, resilient supply chain.” – Shilpan Amin, SVP & Global Chief Procurement and Supply Chain Officer, General Motors