Battery Mineral Resources Corp. Announces Financial Arrangements for the Restart of Production at Punitaqui C$8,000,000 Credit Facility, US$5,000,000 Javelin Facility Draw Down, and Offering of up to US$400,000 in Unsecured Convertible Debentures
{02238810.4}
Battery Mineral Resources Corp. Announces Financial Arrangements
for the Restart of Production at Punitaqui
C$8,000,000 Credit Facility, US$5,000,000 Javelin Facility Draw Down, and
Offering of up to US$400,000 in Unsecured Convertible Debentures
Vancouver, British Columbia – (March 11, 2024) – Battery Mineral Resources
Corp. ( TSXV: BMR ) ( OTCQB: BTRMF ) (“ Battery” or “BMR” or the
“Company”) is pleased to announce that its wholly-owned subsidiary, ESI
Energy Services Inc. (“ ESI”), has entered into a n C$8,000,000 credit
agreement (the “Credit Agreement”) with Fiera Enhanced Private Debt Fund
(“Fiera”). ESI has drawn a first advance of C$5,000,000 under the Credit
Agreement and may, subject to the satisfaction of certain conditions, draw a
second advance of up to C$3,000,000 before May 15, 2024.
The net proceeds of the Credit Agreement will be primarily distributed by ESI
to the Company for use towards the restart of copper concentrate production
at its Punitaqui Project in Chile.
In this regard, personnel hiring for the resumption of full operations at
Punitaqui remains on schedule. Mine maintenance at the San Andres mine is
nearly complete with mine maintenance at the Ci nabrio mine, the original
mine which served to supply the Punitaqui plant with copper mineralised
material for the 10+ years of prior operations, is well underway. All activities
in the mines and the plant which are aimed at full operational commissioning
of the plant in the near term and plant start -up in Q2 of 2024 are also
progressing well.
Credit Agreement Terms
The loans advanced under the Credit Agreement bear interest at a floating
prime rate plus an applicable margin and will mature on the third anniversary
of the Credit Agreement. ESI is required to make monthly principal
- 2 -
{02238810.4}
repayments based on a seven -year amortization schedule. ESI anticipates
servicing its payment obligations under the Credit Agreement out of operating
cash flows, including from operations of its wholly -owned subsidiary, Ozzie’s
Inc. (“Ozzie’s”).
The obligations of ESI under the Credit Agreement have been guaranteed by
Ozzie’s and secured by all of the assets of ESI and Ozzie’s. In addition, ESI’s
direct parent, BMR Holdings Limited has provided a pledge of its shares in ESI.
ESI and Ozzie’s hold zero percent of the Company’s mineral assets, operations
or real property in Canada, the United States, South Korea, or Chile, meaning
that t he security granted by ESI and Ozzie’s does not encumber the
Company’s mineral assets and operations, including the Punitaqui Project.
The Credit Agreement contains customary representations and warranties,
covenants and events of default, including requirements that ESI maintain a
minimum working capital ratio, a minimum fixed coverage charge ratio and a
minimum quarterly revenue level. A copy of the Credit Agreement will be
available on the Company’s SEDAR+ profile at www.sedarplus.ca.
Fiera is an arm’s length party from the Company and ESI and does not
currently hold any equity interest in the Company or any of its subsidiaries.
The loans advanced under the Credit Agreement are non -convertible into
equity of the Company and no bonus securities were issued in connection with
the Credit Agreement.
Draw on Javelin Facility
In addition, t he Company announces that it has drawn US$5,000,000
(approximately C $6,764,000) under its Copper Concentrate Prepay facility
with Javelin Global Commodities (“ Javelin”). The facility was previously
announced in the Company’s new release dated February 12, 2024.
Debenture Offering
The Company is also pleased to announce a private placement offering (the
“Private Placement ”) of unsecured convertible debentures (the
“Debentures”) for total gross proceeds of up to US$400,000 (approximately
- 3 -
{02238810.4}
C$541,120). The proceeds from the Debentures will be applied towards the
restart of production at the Punitaqui Project, and for working capital.
The terms of the Debentures will be the same as the debentures which were
issued pursuant to the private placement previously announced by the
Company in its new releases dated October 17, 2023, October 19, 2023,
November 3, 2023, December 19, 2023, February 2, 2024, and February 16,
2024 (the “First Offering”).
Specifically, t he Debentures will mature on September 30, 2026 (the
“Maturity Date”) and will bear interest at 10% per annum, compounding
annually on September 30 of each year, not in advance. Interest accrued from
the date of issuance and up to and including March 30, 2025, will be paid by
way of issuance of common shares of the Company. Interest accrued following
March 30, 2025, will be, at the option of the holder, paid either in cash or by
way of issuance of common shares of the Company. The issuance of common
shares as payment of interest will be at the then current market price of the
Company’s common shares at the date the interest becomes payable and will
be subject to the prior acceptance of the TSX Venture Exchange and applicable
securities laws.
The holder of a Debenture may, at their option, at any time from the date that
is four months and one day following the issuance of such Debenture, and
prior to the close of business on the business day immediately preceding the
Maturity Date, convert all, but not less than all, of the principal amount of
such Debenture into common shares of the Company at the conversion price
of US$0.22 per share.
Weston Energy LLC II, a fund operated by Yorktown Partners LLC, and an
existing shareholder of the Company, has subscribed for US$300,000
(approximately C$405,840) in principal amount of Debentures in the Private
Placement. The Debenture financing is anticipated to close in two or more
tranches.
Max Satel, CFO commented: “With the Credit Agreement, the draw on the
Javelin facility, and the Private Placement, we’re pleased to have secured the
balance of the financing required to bring the Punitaqui Project back into
production, which we anticipate will occur in Q2 of 2024. We wish to extend
our gratitude to our stakeholders for their continued support of Company.”
- 4 -
{02238810.4}
Finder’s Fees Pursuant to First Offering
Pursuant to the First Offering, the Company paid finder’s fees in the aggregate
amount of US$36,000 (approximately C$48,70 1) to Odeon Capital Group,
LLC.
Resignation of Derek White
Derek White has resigned as director of the Company effective as of March
11, 2024 . The Company wishes to thank Mr. White for his guidance and
support of the Company during his tenure as a director.
Exchange Rates
All USD amounts for which CAD equivalent amounts are given in this news
release were calculated at CAD /USD exchange rate of 1.3528, the exchange
rate published by the Bank of Canada on March 6, 2024.
About Battery Mineral Resources Corp.
BMR is a battery minerals company providing shareholders exposure to the
global mega-trend of electrification while being focused on growth through
cash-flow, exploration, and acquisitions in favourable mining jurisdictions.
BMR’s mission is the discovery, acquisition, and development of battery
metals (namely cobalt, lithium, graphite, and copper), in North America,
South America and South Korea and to become a premier and responsible
supplier of battery minerals to the electrification marketplace. BMR is currently
pursuing a near -term resumption of operations of the Punitaqui Mining
Complex, a past copper-gold-silver producer, in the Coquimbo region of Chile.
BMR is the largest mineral claim holder in the historic Gowganda Cobalt-Silver
Camp in Ontario, Canada, and continues to pursue a focused program to build
on the recently announced, +1 -million-pound high-grade cobalt resource at
McAra. In addition, Battery Mineral owns 100% of ESI Energy Services, Inc.
(including ESI’s wholly owned USA operating subsid iary, Ozzie’s, Inc.), a
profitable mainline pipeline and renewable energy equipment rental and sales
company with operations in Alberta, Canada and Arizona, USA. Battery Mineral
Resources is based in Canada and its shares are listed on the TSXV under the
symbol “BMR” and on the OTCQB under the symbol “BTRMF”. Further
information about BMR and its projects can be found on www.bmrcorp.com.
For more information, please contact:
- 5 -
{02238810.4}
Martin Kostuik, CEO
Phone: +1 (604) 229 3830
Corporate Communications
IBN (InvestorBrandNetwork)
www.investorbrandnetwork.com/
310.299.1717 Office
Twitter: @BMRcorp_
Facebook: Battery Mineral Resources Corp. | Facebook
LinkedIn: Battery Mineral Resources Corp.: My Company | LinkedIn
Website: www.bmrcorp.com
Neither the TSXV nor its Regulation Services Provider (as that term is defined
in the policies of the TSXV) accepts responsibility for the adequacy or accuracy
of this press release. The completion of the Private Placement and the
transactions contemplated by the Credit Agreement are subject to the
acceptance of the TSX Venture Exchange (“TSXV”).
Forward Looking Statements
This news release includes certain “forward -looking statements” under
applicable securities laws. There can be no assurance that such statements
will prove to be accurate, and actual results and future events could differ
materially from those anticipated in such statements. Forward -looking
statements reflect the beliefs, opinions and projections of the Company on the
date the statements are made and are based upon a number of assumptions
and estimates that, while considered reasonable by the Company, are
inherently subject to significant business, economic, competitive, political and
social uncertainties and contingencies. Many factors, both known and
unknown, could cause actual results, performance, or achievements to be
materially different from the results, performance or achievements that are or
may be expressed or implied by such forward -looking statements and the
parties have made assumptions and estimates based on or related to many of
these factors. Such factors include, without limitation, the abili ty of the
Company to obtain sufficient financing (including through the Private
Placement and additional draws under the Credit Agreement and the
arrangements with Javelin ) to complete exploration and development
activities, the ability of the Company to close further tranches of the Private
Placement and to access further draws under the Credit Agreement and the
arrangements with Javelin , the completion, timing and size of the proposed
Private Placement, the intended use of the proceeds of the Private Placement
and draws under the Credit Agreement and the Javelin arrangements, risks
- 6 -
{02238810.4}
related to share price and market conditions, the inherent risks involved in
the mining, exploration and development of mineral properties, the ability of
the Company to meet its anticipated development schedule, government
regulation and fluctuating metal prices. Accordingly, readers should not place
undue reliance on forward -looking statements. Battery undertakes no
obligation to update publicly or otherwise revise any forward -looking
statements contained herein, whether as a result of new information or future
events or otherwise, except as may be required by law. For further information
regarding the risks please refer to the risk factors discussed in Battery’s most
recent Management Discussion and Analysis filed on SEDAR+.