12:15 PM EDT, 10/25/2024 (MT Newswires) -- Electra Battery Materials ( ELBM ) said Friday that it will raise US$5 million after receiving a non-binding term sheet from the holders of its existing secured notes for a financing transaction.

The company said it will use the funds to initiate early works and winter preparations at the Ontario Refinery project site in Temiskaming Shores, Ontario, as well as for general corporate purposes.

"Given our objective of resuming construction shortly upon completing the project financing package, part of our preparations for the final phase of construction of North America's only cobalt sulfate refinery is initiating some early works before winter sets in," chief executive Trent Mell said. "This liquidity strengthens our balance sheet as we work to complete this package, and we are grateful for our lenders' ongoing support of our business plan."

The financing will consist of the sale of secured convertible notes in the principal amount of US$4 million and US$1 million of common shares at a price of US$0.543 per share.

Electra said the notes will be issued together with 4.55-million detachable warrants. Each warrant can be exercised at $1.00 per share for 24 months.

Electra's shares were last seen down $0.03 to $0.71 on the TSX Venture Exchange.

Price: 0.71, Change: -0.03, Percent Change: -4.05