Lanka Graphite intends to use A$1.427 million it plans to raise through issuing convertible notes to further advance an MoU regarding potential commercialisation of Sri Lanka graphite mining operations and for working capital purposes.
The ASX-listed company has entered into agreements to issue the unsecured notes and, subject to shareholder approval, they will be convertible into shares priced at $0.125 at the election of the note holder. This represents a premium of 56% to the closing price on Friday, September 30.
The convertible notes will have a term of 1 year and unconverted notes may be redeemed by the note holder at the end of the term.
Lanka Graphite executive chairman Jitto Arulampalam said, “It is very pleasing for us to have the support of our new convertible note investors as Lanka prepares for the most significant development stage of our company.
“This investment will provide us with the working capital to progress our MoU with the government of Sri Lanka for the future development of Sri Lanka’s vein graphite mining industry.”
Meantime, Lanka is progressing separate graphite projects to a drill-ready stage and is completing graphene research through a collaboration agreement with a university in Taiwan. The company is planning further exploration.