Zeta Resources has provided Alliance Nickel an unsecured $4 million loan facility to complete a definitive feasibility study (DFS) at its NiWest Nickel-Cobalt Project.
Zeta Resources is a long-term major shareholder of Alliance. Key terms of the unsecured loan facility are an interest rate of ten per cent per annum and a maturity date of 28 October 2024 (or such other date as agreed in writing). The loan will be drawn in full on 25 July 2024.
Subject to shareholder approval, the company will issue Zeta Resources 22,222,222 unquoted options exercisable at $0.18 each, a significant premium to its 30-day VWAP of $0.038.
The options will expire three years from the date of the loan facility agreement, subject to shareholder approval at a general meeting to be convened at a future date.
If shareholder approval is not obtained within three months of the date of the loan facility, the company will pay the lender an option fee of $345,000.
Following a period of due diligence, Alliance has said that its board is satisfied with the competitive terms offered by Zeta.
Alliance Nickel Managing Director and CEO, Paul Kopejtka, said that Zeta Resources is a long-term supportive shareholder backing the future success of Alliance’s NiWest Project and the key role nickel plays in the electric vehicle revolution.
“This unsecured bridging loan provides us with competitive financing to allow the company to complete the NiWest Project DFS and final metallurgical testing,” Mr Kopejtka said.
“The loan facility also provides us with working capital as we progress with offtake and investment discussions with a potential strategic partner.”
Featured image: fizkes/shutterstock.com.
