Battery Mineral Resources secures funding for Punitaqui Restart

Battery Mineral Resources Corp. has announced that its wholly-owned subsidiary, ESI Energy Services Inc. (“ESI”), has entered into an 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 Cinabrio 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 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 the 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.