Graphite mineral developer Walkabout Resources has declared the conclusion of the interim funding measures that were executed throughout the initial six months of the year.
The company has reached an agreement with its engineering, procurement and construction (EPC) contractor Jinpeng, stipulating that all contractual milestones accomplished up to the present moment and those to be achieved until practical completion will be compensated in monetary terms.
Additionally, up to a sum of $500 000 related to contractual milestone payments post practical completion shall be satisfied by issuing shares at a value of $0.11 each. This particular accord supersedes the prior arrangement that was announced on March 6 and was ratified by the shareholders during the general assembly convened on June 12.
The most recent disbursement has been sourced from the funds accessed through the senior debt facility established in collaboration with Gemcorp. An additional payment connected to contractual milestones is anticipated to be disbursed from a secondary tranche scheduled for release within the present month.
Notably, Walkabout had initially allocated 9.2-million shares as collateral for the provisional funding advanced by TNR. As the interim funding provided by TNR has now been repaid through the use of the senior debt, the intention of the company is to nullify the aforementioned shares.
This particular course of action necessitates the endorsement of shareholders, an event which is slated to occur during the forthcoming annual general meeting.
Moreover, Walkabout has also released about 4.2-million shares at a unit price of $0.11 each, constituting part of the resolution of the remaining shareholder bridging loans.
Upon the culmination of the interim funding measures, a reorganisation of the financial structure for the Lindi Jumbo graphite project, in Tanzania, has been effected. This reorganisation encompasses several elements.
Firstly, a senior debt facility amounting to $20-million has been established, with a portion of the allocated funds having been drawn down.
Additionally, a senior debt standby facility, totalling $5-million, has been put in place. As of now, no use of these reserved funds has occurred.
Further, a standby placement facility, with an available capital of $10-million, has been established. Similar to the senior debt standby facility, no allocation of these funds has been undertaken yet.
“The redirection of senior debt to repay the previously extended interim funding reinstates the original arrangement for milestone payments outlined in the EPC and TNR agreements. The company’s strategic disposition towards favouring senior debt for project construction has been an inherent principle guiding the allocation of our capital resources.
“Given the anticipated high profit margin of the Lindi Jumbo project, this judicious allocation of capital is likely to yield comparatively elevated returns for our valued shareholders," Walkabout CEO Andrew Cunningham said.