Uranium explorer West Australian Metals has secured $1.4 million in cash through a convertible note facility with Subiaco-based Batavia Mining.
Uranium explorer West Australian Metals has secured $1.4 million in cash through a convertible note facility with Subiaco-based Batavia Mining.
Under the deal, Batavia has the right to convert the notes, which have a face value of $50,000 each, into 20 million ordinary shares at a conversion price of seven cents each.
WAM said the shares will be voluntarily escrowed unless a number of specific circumstances are triggered including a minimum share price of 22c over a five day trading period.
Funds will be applied to WAM's Marenica uranium project in Namibia.
Shares in WAM closed unchanged at 6.2c today.
The announcement is below:
Uranium explorer West Australian Metals Limited (ASX: WME) has taken a further step in its recent corporate repositioning after today announcing that it had secured a $1.4 million cash injection (subject to the satisfaction of various conditions precedent) through a convertible note facility with ASX-listed mining company, Batavia Mining Limited (ASX: BTV).
The funding injection follows a series of recent corporate changes for the Perth-based junior. Over the past six weeks, it has announced key Board changes - including the appointment of experienced mining executive Neil Biddle as a non-executive Director and the appointment of a new Chief Executive Officer, John Young.
International geological, mining and management consultancy CSA Global Pty Ltd has also been appointed as geological adviser for the Company's flagship Marenica Uranium Project in Namibia to assist in progressing it towards a Scoping Study during 2009.
The Convertible Notes, which are unsecured, have a face value of $50,000 each with interest of 8% per annum paid on maturity or conversion; the notes will mature 12 months from allotment. Batavia has the right to convert the notes into 20 million ordinary fully paid shares with a conversion price of 7 cents per share. The shares will be voluntarily escrowed unless a number of specific circumstances are triggered including, but not limited to, a minimum share price of 22 cents for a period of five consecutive trading days.
Recently appointed West Australian Metals CEO John Young said he was pleased to have secured the involvement of Batavia in the Company through the convertible note arrangement.
"Batavia has provided funding at this critical juncture for the Company, with its investment driven by the positive view it has of the potential of the Marenica Uranium Project as a high-quality development opportunity in one of the world's most exciting emerging uranium provinces," Mr Young said.
"We believe that Marenica has great potential as mining asset plus outstanding exploration potential within our tenement holding for hard rock uranium deposits," he continued. "It is located within one of the world's most exciting emerging uranium provinces, in close proximity to a number of existing and new mining operations."
Based on historical and new data, West Australian Metals has delineated a JORC compliant uranium resource containing 34 million pounds of U3O8 within the Exclusive Prospecting Licence (EPL) 3287, which covers an area of 706 square kilometres.
The Project lies in the same uranium province as the Rossing and Langer Heinrich uranium mines (Paladin Resources Ltd) and immediately north of the large Trekkopje Mine, which is currently being developed by the international uranium giant, Areva NC.
