Electra's $30 Million Private Placement to Boost Refinery Completion
Electra Secures $30 Million for Strategic Refinery Development
Electra Battery Materials Corporation (NASDAQ: ELBM) proudly announces the terms of a $30 million brokered private placement, which is a crucial aspect of the company's financial restructuring. This financing aims to facilitate the establishment of North America's first battery-grade cobalt sulfate refinery, marking a significant milestone in Electra's development strategy.
Engagement with Co-Lead Agents
To effectively manage this extensive financing venture, Electra has partnered with Cantor Fitzgerald Canada Corporation and ECM Capital Advisors Ltd. as co-lead agents. Their collective expertise in the market supports Electra's endeavor to raise funds through the private placement of a minimum of 40 million Units, each priced at $0.75, resulting in gross proceeds of at least $30 million.
Key Features of the Offering
Each investment Unit comprises one common share and one common share purchase warrant, granting investors the option to acquire additional shares at a price of $1.25 each over a period of 36 months following the offering. This structure aims to align investor interests and bolster share liquidity as the company progresses towards its strategic goals.
Support from Lenders and Shareholder Engagement
The offering is further backed by a $10 million conditional commitment from senior secured convertible noteholders. Moreover, Electra is providing existing shareholders with preferential participation rights, allowing them to invest under the same conditions as new investors. Interested shareholders can connect directly with the company for more information on participating in this unique opportunity.
Purpose of Proceeds from the Offering
The proceeds from the private placement will primarily be allocated towards accelerating the development and scaling of Electra's cobalt refinery, enhancing its black mass recycling initiatives, and addressing obligations related to previously issued promissory notes. If the offering exceeds $34.5 million, additional funds will strategically target refinancing efforts for outstanding notes.
Timeline for Closing the Offering
Electra is poised to conclude the offering around mid-October, concurrently with its broader restructuring. This timeline hinges on shareholder approval during an anticipated special meeting, necessary to meet regulatory requirements from the TSX Venture Exchange and the Nasdaq Stock Market. The company's actions signal a committed approach toward its growth objectives in the critical minerals supply sector.
Agent Compensation and Investors' Guidelines
For their pivotal roles in facilitating the offering, Electra will compensate the agents with a cash commission amounting to 6% of gross proceeds, alongside issuing non-transferable broker warrants equivalent to 6% of the units sold. This structure rewards the agents for their collaboration while providing a clear investment guideline for potential participants.
Electra's Commitment to Sustainable Growth
As a major contender in the development of critical minerals for battery technologies, Electra is focused on its cobalt sulfate refinery and other sustainable practices, such as nickel refining and battery recycling. The company continuously evaluates opportunities to expand its operations while minimizing reliance on global supply chains.
Future Potential and Market Position
Electra's strategic objectives align closely with the growing demand for ethically sourced and responsibly processed battery materials. By solidifying its position in the critical minerals supply chain, the company not only supports local economies but also strengthens its commitment to environmental sustainability.
Frequently Asked Questions
What is the purpose of the $30 million offering by Electra?
The funds will be used to complete the construction of Electra's cobalt refinery and to support other operational initiatives.
Who are the co-lead agents for this financing?
Cantor Fitzgerald Canada Corporation and ECM Capital Advisors Ltd. are the co-lead agents facilitating the offering.
What are the terms of the investment Units?
Each Unit consists of one common share and one warrant, with the latter allowing the holder to purchase additional shares at $1.25 over 36 months.
How will existing shareholders participate in this offering?
Existing shareholders can participate on the same terms as new investors, making the offering accessible to those already invested in Electra.
When is the expected closing date for the offering?
The offering is anticipated to close around mid-October, pending necessary approvals.
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