Volt Resources executes US$8.5 million debt facility term sheet with JES Green Investments

Volt Resources Ltd (ASX:VRC) (FRA:R8L) has executed a term sheet with European investment company, JES Green Investments Ltd for a US$8.5 million debt facility.  The facility will go towards the funding of Volt’s acquisition of a 70% interest in the Zavalievsky group of companies (ZG Group) and related expenses, as well as to provide working capital.  To facilitate drawdown under this facility, Volt and the ZG Group vendors have agreed to extend the date for completion of the ZG Group acquisition to June 11, 2021.  The ZG Group acquisition will transform Volt into one of the few ASX-listed graphite producers without the usual time and risk related to complete greenfield project financing, construction, commissioning and ramp-up.  Contribution of chair Asimwe Kubunga Volt managing director Trevor Matthews said: “Volt is delighted to be partnering with JES Green Investments for the funding for the ZG business acquisition and working capital. “We are already working on the draft loan agreement and security documents to quickly move to the drawdown of funds for the acquisition completion. “The board also acknowledges the significant contribution of Volt’s chairman Asimwe Kubunga in providing his Volt shareholding as security for the JES Green Investments’ loan. Administrative changes “JES Green Investments has a strong focus on ESG principles and Volt’s commitment to sustainable operations and community development opportunities created instant alignment between us. “I will be travelling to Ukraine next week to be in Kyiv to be present when we execute the documents required for the transfer of shares, appointment of Volt directors to the various ZG group company boards and other administrative changes.” Terms of loan agreement The terms of the loan agreement are as follows: First tranche of US$4.255 million to be drawn following execution of loan agreements and security documentation, expected to be around June 1, 2021; and Second tranche of US$4.255 million scheduled to be drawn down by June 10, 2021. A total of 50 million options over Volt fully paid ordinary shares, with each option being exercisable at any time within 24 months from the date of issue, comprising: 25 million options with an exercise price of $0.06 per Volt share, to be issued following receipt of the first funding tranche; and 25 million options issued with an exercise price to be based on the 5-day VWAP prior to the commitment of funds for the second tranche drawdown. ZG Group acquisition update The completion of the acquisition of a controlling 70% interest in ZG Group is now scheduled to occur on or before June 11, 2021. Volt is required to pay the first instalment of US$3.8 million to the ZG Group vendors on completion of the acquisition. The final instalment of US$3.8 million is payable six months after completion of the transaction. This acquisition of a controlling 70% interest in the ZG Group will immediately transform Volt into one of the few ASX-listed graphite producers. Sale of processing plant and equipment The ZG Group has plans to install a processing plant and equipment to commence production of spheronised purified graphite (SPG) for the European LIB anode market within the next 12 months. This will create the only European integrated mine and SPG producer. The ZG group graphite business produces a high-value 'green' purified 99.5% TGC product. Zavalievsky mine’s strategic location for the future supply of SPG to the European markets has already attracted interest from LIB cell manufacturers and major carmakers.