Bushveld Minerals Regulatory News (BMN)

Market Abuse Regulation ("MAR") Disclosure

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. 

Bushveld Minerals Limited

("Bushveld" or the "Company")

Agreement on Convertible Loan Note Refinancing

27 November 2023

Bushveld Minerals Limited (AIM: BMN), the integrated primary vanadium producer, is pleased to announce that it has entered into a conditional agreement to refinance its existing convertible loan notes with Orion Mine Finance ("Orion"), following the Term Sheet agreed in May this year.

Highlights:

§ Today's conditional agreement extends the maturity date for Bushveld's existing convertible loan notes to 31 January 2024 (from 21 December 2023) and refinances the convertible debt obligations of c.US$46.9 million (including accrued interest) as follows:

· Conversion of 10% of the outstanding balance (including interest) of the convertible debt obligations ("CLN Balance"), expected to be c.US$4.7 million, as at the effective date[1] into shares at 3.00p per share.

· A new convertible loan note of c.US$14.1 million representing 30% of the CLN Balance maturing in June 2028.

· A term loan of c.US$28.1 million representing 60% of the CLN Balance.

· Supplemental royalty at not more than 0.264% of Bushveld's gross revenues and reducing by 80% at the term loan maturity.

§ New structure better aligns repayment with expected internal cash generation projections.

§ The refinancing is conditional upon (inter alia):

· Entry into the finance and security documents, which are progressing accordingly.

· Bushveld shareholder approval.

· Raising of at least US$12.0 million via the issue of new ordinary shares in the Company to third party and existing investors (which would be satisfied by the proposed equity investment by Southern Point Resources - Fund 1 SA L.P., represented by its general partner SPR GP1 Proprietary Limited).

· Consent by the Financial Surveillance Department of the South African Reserve Bank.

· Completion of the Share Exchange transaction between the Company and the minority shareholders in Bushveld Vametco Holdings Pty Ltd, by which the Company will become the 100% shareholder in Bushveld Vametco Holdings Pty Ltd, as announced on 30 October 2023.

§ All outstanding conditions are expected to be satisfied in due course, and the transaction is expected to complete before the 31 January 2024 deadline agreed by all parties.

Craig Coltman, CEO of Bushveld Minerals commented:

"I am pleased to announce today's agreement with Orion, which has supported the Company since it's initial investment three years ago. Since first announcing the terms of the proposed restructuring earlier this year, there has been an imperative to enter into a binding agreement with Orion, and whilst the refinancing remains conditional upon certain items, including Bushveld shareholders' approval, it provides certainty as we move forward with the other elements of our financial package.

The restructuring is a key part of our strategy to restore value in the Company, along with ensuring Bushveld delivers its operational targets, simplifies its corporate structure and refines its investment proposition."

Key Terms of the Proposed Refinancing

§ 10% of the CLN Balance (c. US$4.7 million) to be capitalised into a subscription for shares in Bushveld at 3.00p per share, a 48% premium to the 20-day weighted average share price (as at 24 November 2023).

§ 30% of the CLN Balance (c.US$14.1 million) to remain as a convertible loan note with the following revised terms ("New CLN"):

· Interest: 12%

· Conversion price: 3.99p

· Maturity Date: 30 June 2028

· Bushveld shall have a one-time right to redeem 50% (in whole and not in part) of the New CLN in June 2026, subject to the right of Orion to elect for conversion of the same for a 30-day period.

§ 60% of the CLN Balance (c.US$28.1 million) will be converted into a secured term loan ("Term Loan") on the following terms:

· Interest: 6.0% ("Margin") plus the greater of (i) 3-month Secured Overnight Financing Rate ("SOFR") and (ii) 3.0% per annum.

· Interest payable quarterly in arrears in cash starting from the last business day of the quarter in which the closing of the transaction occurs and on the last business day of each quarter thereafter. In the event that the Company has insufficient cash available to pay interest on its due date, the interest due on that date shall continue to accrue. In the event of default, the Margin will be increased by 3%.

O  Principal repayments structured to

a. 25% of the facility amount (c. US$7.0 million) to be repaid by 30 June 2024

b. 30% of the facility amount (c. US$8.4 million) to be repaid by 30 June 2025

c. 45% of the facility amount (c. US$12.6 million) to be repaid by 30 June 2026

· The facility may be prepaid in whole or in part at any time. Prepayment is subject to the following early redemption fee schedule based on the outstanding balance at the time of prepayment.

o  Prior to 30 June 2024: 4%

o  After 30 June 2024 until 30 June 2025: 3%

o  After 30 June 2025 until 30 June 2026: 2% 

§ Supplemental royalty, on the same terms as the existing Production Financing Agreement during the tenure of the Term Loan, except for the following:

· Royalty repayment rate of 0.264% with a realised price per kgV of less than US$47/kgV.

· Royalty repayment rate of 0.216% with a realised price per kgV of greater than US$47/kgV.

· The later of 30 June 2027 and when the Term Loan has been fully repaid, the repayment rate will reduce by 80% and shall be payable for the life of the Vametco operation.

ENDS

Enquiries: info@bushveldminerals.com

ABOUT BUSHVELD MINERALS LIMITED

Bushveld Minerals is a vertically integrated primary vanadium producer, it is one of only three operating primary vanadium producers. In 2022, the Company produced more than 3,800 mtV, representing approximately three per cent of the global vanadium market. With a diversified vanadium product portfolio serving the needs of the steel, energy and chemical sectors.

Detailed information on the Company and progress to date can be accessed on the website www.bushveldminerals.com