Electra Battery Materials Corporation has announced receipt of a non-binding term sheet from holders of its existing secured notes issued on February 13, 2023. The proposed financing transaction is expected to generate gross proceeds of US$5 million, enabling the company to initiate early works and winter preparations at its Ontario Refinery project site in Temiskaming Shores, Ontario. The funds will also support general corporate purposes.
“With our objective to resume construction shortly after completing the project financing package, initiating early works before winter is crucial for the final phase of building North America’s only cobalt sulfate refinery,” said Electra CEO Trent Mell. “This liquidity strengthens our balance sheet as we work to finalize the financing, and we appreciate our lenders’ ongoing support of our business plan.”
Mell added, “Reducing heavy reliance on China in the EV materials supply chain remains a focus for North American policymakers. Electra’s refinery is expected to be the first of its kind in North America, with the potential to produce enough cobalt sulfate for one million electric vehicles each year when operating at full capacity.”
The financing will consist of secured convertible notes totaling US$4 million and US$1 million in common shares priced at US$0.543 per share. The notes come with 4,545,454 detachable common share purchase warrants, each allowing the holder to acquire one common share at C$1.00 per share within 24 months of issuance.
Conversion of the notes and exercise of the new warrants will be limited to prevent any holder from owning more than 9.9% of Electra’s outstanding common shares.
Source: Electra Battery Materials
