Electra Battery Materials Corporation has announced it has entered into subscription agreements with investors for the issuance (the “Note Offering”) of US$51 million principal amount of 8.99% senior secured convertible notes due February 2028 (the “Notes”).
Electra is also in active discussions with the Government of Canada and Government of Ontario, seeking a commitment of up to US$7.5 million (C$10 million) in additional total funding to support the recommissioning of the Company’s wholly-owned hydrometallurgical cobalt refinery (the “Refinery”) located north of Toronto.
The governments of Canada and Ontario have each previously provided US$7.5 million toward the project. The terms and conditions for these potential sources of funding are under discussion and subject to final government approvals, therefore there is no guarantee this additional capital will be provided on terms the Company can satisfy, or at all.
The Company will purchase all of the outstanding approximately US$36 million of existing 6.95% senior secured notes due 2026 (the “2026 Notes”) for cancellation at par, plus accrued and unpaid interest.
The net proceeds of the Note Offering of approximately US$15 million will be used for capital expenditures associated with the expansion and recommissioning of the Refinery, including buildings, equipment, infrastructure, and other direct costs, as well as engineering and project management costs. Upon completion of the Note Offering, the Company will have US$51 million principal amount of Notes outstanding, and no 2026 Notes outstanding.
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