Far Resources Ltd, a Vancouver-based developer of battery metals mineral resources, has secured a draw-down equity facility of up to $12 million.
The investor is Alumina Partners, a U.S. private equity firm.
The funds raised will strengthen the company’s balance sheet and allow it to pursue lithium exploration activities at the Zoro project in Manitoba and Hidden Lake project in the Northwest Territories.
Alumina Managing Member Adi Nahmani said the deal supports Far Resources’ growth plan to “better reflect the mission critical role that lithium plays in the global mobile technology market.”
Far Resources Secures CAD $12 Million Equity Facility with New York-Based Alumina Partners
VANCOUVER, BC / ACCESSWIRE / February 15, 2019 / Far Resources Ltd (CSE:FAT) (FSE:F0R) (OTC:FRRSF) is pleased to announce that it has secured a non-exclusive draw-down equity facility of up to CAD $12 million with Alumina Partners, LLC, a New York-based private equity firm.
As well as strengthening the company’s balance sheet, the facility will allow Far to pursue its highly successful exploration activities at Zoro and Hidden Lake and to take advantage of new opportunities in the technology metals sector, increasing its ability to move quickly with new strategies.
The terms of the agreement will allow Far to draw down capital at will, on an as-needed basis, in a series of equity private placements of up to CAD $1 million each over a 24-month period, in accordance with exchange policies. The objective is to provide Far with more flexible access to capital at the Company’s sole discretion.
“This represents a significant milestone for Far,” said Far President and CEO, Toby Mayo. “This partnership and cornerstone investment from Alumina will allow the company to advance its excellent Canadian hard rock lithium assets—which are standing up to multiple rounds of expansive exploration—and to pursue its longer term strategies in the sector. The next 12 to 24 months look extremely exciting for the company as we raise our profile and move to become a major participant in North American technology metals.”
“We are very excited to support Far Resources in their ambitious plans to not only expand their footprint in the lithium space but also to transformatively grow their business to better reflect the mission critical role that lithium plays in the global mobile technology market,” added Adi Nahmani, Managing Member of Alumina Partners, LLC. “We were deeply impressed by management’s expertise not just in the science of their own business but also their planned outreach to the high-margin, high-demand industries that depend on more and more lithium to supply their growth. We look forward to investing in Far and to watching 2019 unfold.”
Pursuant to the terms of the Agreement, Far is able to draw-down capital at will, on an as-needed basis and subject to acceptance by Alumina Partners, in a series of separate equity private placement tranches of up to CAD $1 million (each, a “Tranche”) over a 24-month period, in accordance with the policies of the Canadian Securities Exchange (the “CSE”). Each Tranche will be comprised of units (the “Units”), each Unit consisting of one common share in the capital of the Company (each, a “Share”) and one-half (1⁄2) of one common share purchase warrant (each, a “Warrant”), with each whole Warrant entitling the holder to acquire one additional Share for a period of 36 months from the date of issuance. The Units will be issued at discounts ranging from 15% to 25% of the market price of the Shares at the time of the draw-down (the “Market Price”), with each Tranche occurring exclusively at the option of the Company, throughout the two-year term of the Agreement. The exercise price of the Warrants will be at a 50% premium over the Market Price of the Shares. In the event the 10-day volume weight average price of the Shares, as traded on the CSE, commencing four months and one day from the closing of the applicable Tranche is equal to or greater than 200% of the Warrant exercise price, the Company may accelerate the expiry of the Warrants by providing notice to the shareholders thereof, and in such case, the Warrants will expire on the 30th day after the date on which such notice is given by the Company. There are no up-front fees or interest associated with the use of the Facility. The Company and Alumina Partners have agreed to a CAD $100,000 initial draw-down under the Facility. The Company will issue to Alumina Partners 1,333,333 Units at a price of $0.075 per Unit, each Unit consisting of one Share and one-half of one Warrant, with each whole Warrant entitling the holder to acquire one additional Share for a period of 12 months at the price of $0.10 per Share.
No upfront fees or interest payments are associated with the use of this facility.
Far Resources Ltd. is a Canadian battery and technology minerals exploration and development company with projects in Canada and the USA. More information on Far is available at www.farresources.com.
Terri Anne Welyki