SCHEDULE 13D: Condire Management Discloses 9.9% Stake in Osisko Development Corp., Secures Board Observer Role

Condire Management, LP and its affiliates have disclosed a 9.9% beneficial ownership stake in Osisko Development Corp., acquired for investment purposes, and have agreed with the Issuer on the appointment of an independent board observer.

Summary

• Condire Management, LP, along with its affiliates Condire Management GP Holdings, LLC, Ryan E. Schedler, and Bradley J. Shisler (collectively, the "Reporting Persons"), have filed a Schedule 13D disclosing a 9.9% beneficial ownership stake in Osisko Development Corp.
• The Reporting Persons collectively beneficially own 13,813,940 Common Shares of Osisko Development Corp., including 1,697,451 shares issuable upon the exercise of warrants.
• This ownership percentage is calculated based on 136,580,233 Common Shares outstanding as of November 12, 2024.
• The initial significant acquisition occurred on November 12, 2024, when Condire Resource acquired 12,000,000 units directly from Osisko Development Corp. at a price of $1.80 per unit, totaling $21,600,000.
• Each unit consisted of one Common Share (subject to a 4-month hold restriction) and one common Share purchase warrant, exercisable at $3.00 per share until October 1, 2029.
• Condire Resource subsequently sold 575,651 units to Condire Alpha at the same $1.80 per unit price, for an aggregate of $1,036,171.80.
• Additional shares were acquired in the open market by Condire Resource and Condire Alpha between November 26, 2024, and January 31, 2025, at weighted average prices ranging from $1.5248 to $1.8384 per share.
• The securities were acquired for investment purposes, and in connection with the November 12, 2024, transactions, the Issuer and Reporting Persons agreed to find a mutually agreeable independent addition to the Issuer's Board of Directors or a Board observer.
• A "blocker" agreement is in place, limiting the combined shareholdings of Condire Resource, Condire Alpha, and their affiliates in Osisko Development Corp. to less than 10% of the then-outstanding common shares.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. A significant investment by a specialized fund indicates confidence in the company. The agreement for a board observer suggests constructive engagement, although the 'blocker' agreement limits the investor's ultimate control.

Positives

• A significant investment by Condire Management and its affiliates demonstrates confidence in Osisko Development Corp.'s long-term prospects.
• The initial acquisition was part of a private placement, providing capital directly to the Issuer.
• The agreement to appoint an independent board observer suggests a constructive engagement between the significant shareholder and the company's governance.

Negatives

• The "blocker" agreement limits the Reporting Persons' ability to increase their beneficial ownership beyond 9.9%, potentially capping their influence.

Risks

• The "blocker" agreement restricts Condire's combined shareholdings to less than 10% of Osisko Development Corp.'s outstanding common shares, which could limit future strategic maneuvers or influence.
• The warrants held by Condire are subject to a 4-month hold restriction on the underlying shares, and their exercise is limited by the blocker agreement.

Future Outlook

The Reporting Persons acquired the securities for investment purposes and currently have no present plans or proposals that would result in changes to the Issuer's corporate structure, business, or capitalization. However, they retain the right to change their investment intent and may acquire additional shares or dispose of existing holdings in the future.

Management Comments

• The Issuer and the Reporting Persons have agreed on an independent appointee to the Issuer's Board of Directors or, alternatively, a Board observer, who is unaffiliated with and does not report to any of the Reporting Persons.

Industry Context

This filing reflects a significant investment in a resource development company, Osisko Development Corp., by a specialized resource investment firm. Such investments are common in the mining and resource sector, where strategic partnerships and substantial capital injections can be crucial for project development and expansion. The engagement of a major investor like Condire, even with a 'blocker' agreement, signals potential long-term interest in the sector's opportunities.

Management Changes

Corporate Governance

Related Party Transactions

• On November 12, 2024, Condire Resource sold 575,651 units to Condire Alpha at $1.80 per unit for an aggregate of $1,036,171.80. Both Condire Resource and Condire Alpha are managed by Condire Management, LP, making this an internal transfer within the Reporting Persons' group.

Stakeholder Impact

• Shareholders: The entry of a significant institutional investor like Condire Management could be viewed positively, potentially signaling validation of the company's value. The agreement for a board observer may also influence future strategic decisions.
• Company Management: The agreement to appoint a board observer indicates a level of engagement and oversight from a major investor, which could influence management's strategic direction and operational decisions.
• Creditors: The capital raised through the private placement strengthens the company's financial position, which could be beneficial for creditors.

Next Steps

• The Issuer and Reporting Persons have agreed on an independent appointee to the Board of Directors or a Board observer, indicating a future governance change.
• The Reporting Persons retain the right to acquire additional shares or dispose of their holdings in the future, based on their investment intent.

Key Dates

Recommendation

Keywords

Osisko Development Corp, Condire Management, Schedule 13D, beneficial ownership, investment, common shares, warrants, private placement, corporate governance, board observer, mining, resource sector