First Cobalt (TSX-V:FCC, OTCQX:FTSSF) Corp said it has arranged a combined secured convertible debt and brokered equity financing package valued at US$45 million.
The funding will be used to finance the construction of its wholly-owned hydrometallurgical refinery located in Ontario, Canada.
The company is the owner of North America’s only permitted cobalt refinery, which could produce over 25,000 tonnes of cobalt sulfate per year from a third-party feed.
READ: First Cobalt announces two-year joint plant study with Timiskaming First Nation at Cobalt camp district
According to the company, the financing will consist of the following components:
- An offering of US$37.5 million principal amount of 6.95% senior secured convertible notes due December 1, 2026 led by Cantor Fitzgerald & Co.;
- An overnight-marketed public offering of common shares in the capital of the company led by BMO Capital Markets (NYSE:BMO) for gross proceeds of approximately C$9.5 million (about US$7.5 million), at a price per offered share to be determined in the context of the market
"This is one of our most important catalysts for the year, as this financing will allow us to advance construction of our Canadian battery material refinery," Trent Mell, president and CEO said in a statement.
Mell continued: "Our vision is to be the most sustainable producer of battery materials, starting with North America's only domestic supply of battery grade cobalt. Longer term, we are pursuing the creation of a Battery Park around our refinery, which would include battery recycling, nickel sulfate production and lithium-ion battery precursor manufacturing. We intend to capitalize on this first-mover advantage and leverage our position as an ultra-low carbon operation."
The company intends to use the aggregate net proceeds of the offerings 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.
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