Jervois secures $ 75 million support financing facility with Mercuria

Strong points:

• – This stand-by working capital facility represents the first step in what Jervois considers to be a symbiotic relationship and a partnership with Mercuria, in accordance with the memorandum of understanding announced on July 27, 2021.

Australia – 28e, October 2021 – The press wire – Jervois Global Limited (“Jervois“or the”Society“) (ASX: JRV) (TSX-V: JRV) (OTC: JRVMF) advises its subsidiaries Jervois Suomi (Holding) Oy and Jervois Finland Oy (“Jervois Finland“or the”Borrowers“) have entered into a secured loan facility (the”Establishment“) with Mercuria Energy Trading SA, a wholly-owned subsidiary of Mercuria Energy Group Limited (“Mercury“or the”Lender“).

Jervois formed Jervois Finland after completing the 100% acquisition of Freeport Cobalt, a Finnish cobalt refining and specialty products company, in September 2021. The acquisition has the potential to transform Jervois into the second largest producer of refined cobalt outside of China, building on its existing assets, the Idaho Cobalt operations (“ICO”) In the United States and São Miguel Paulista (“SMP”) Nickel and cobalt refinery in Brazil, which Jervois agreed to acquire.

As announced to the market on September 14, 2021, Jervois has appointed a separate management team for Jervois Finland, made up of existing long-term employees from operations.

Key words

The Jervois Finland Facility with Mercuria has a maximum initial amount of US $ 75 million with a maturity of December 31, 2024. Borrowers may draw up to the maximum amount or 80% of the value of the collateral, the collateral being defined as the value of stocks and receivables of Jervois Finland, calculated monthly. The annual interest payable on the amounts withdrawn is LIBOR + 5.0 percent.

The facility is secured by the shares of Jervois Finland and its assets and is guaranteed by Jervois Global. A maximum of US $ 50 million may be transferred out of the Jervois Finland group of companies, for other general purposes within the Jervois Global group.

The Facility includes an uncommitted Accordion for an additional amount of US $ 75 million. The Accordion is subject to the commitment of the Lender and the satisfaction of specific additional requirements related to the security package.

A summary of key terms is included in Appendix A.

The full text of the terms and conditions of the Facility will be filed and available on Jervois’ Company Profile on SEDAR at www.sedar.com.

Use and use of the product

At the time of the acquisition closing on September 1, 2021, Jervois Finland had net working capital of US $ 98 million on its balance sheet, approximately US $ 23 million more than the “target” working capital. »Of US $ 75 million communicated in the ASX announcement, Jervois acquires Freeport Cobalt for $ 160 million (July 27, 2021). Working capital levels fluctuate depending on the price environment of the cobalt market and other factors.

Jervois plans to use the facility to fund working capital levels above the “target” of US $ 75 million. The committed amount of the facility provides leeway to finance working capital in a higher cobalt price environment.

Due to current cobalt prices and dynamic market expectations, Jervois expects the initial use of US $ 32.5 million to occur in November 2021, subject to the satisfaction of customary conditions precedent, including including those related to the execution of security documents on the assets of Jervois Finland. Future proceeds from the drawings could be used to finance higher levels of working capital at Jervois Finland if cobalt prices continue to rise and, if applicable, the financing of the Group’s development activities, including the 47, 5 million reais1 Acquisition payment in cash for the nickel-cobalt refinery SMP that Jervois expects to be due in the first quarter of 2022, in accordance with the expected closing.

Partnership with Mercure

On July 27, 2021, Jervois announced that Mercuria would participate in the Jervois fundraiser associated with the purchase of Jervois Finland, which resulted in a capital investment of US $ 33 million in Jervois and the parties entered into a memorandum binding agreement (“PE“). Mercuria is one of the world’s largest integrated energy and raw materials companies, with annual sales of over US $ 100 billion.

The execution of the facility agreement is a testament to the mutually beneficial business partnership that Jervois began to establish with Mercuria under the MoU. Mercuria and Jervois will continue to work together to advance their business footprint and take advantage of the growing demand for nickel and cobalt products. Other potential areas of cooperation include risk management services, tolls at SMP and / or Kokkola; supply of cobalt hydroxide, freight and warehousing.

Jervois’ financial advisor on the Facility was Magma Capital Advisory.

On behalf of Jervois Global Limited

Bryce Crocker, CEO

For more information, please contact:

Forward-looking statements

This press release may contain certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. When used in this press release, the words “anticipate”, “believe”, “estimate”, “expect”, “target,” plan “,” foresee “,” may “,”, words or phrases identify forward-looking statements or information. Such forward-looking statements or information may relate to the timing of the withdrawal of the working capital facility by Jervois Finland, the amount of working capital required, the acquisition of SMP and certain other factors or information. These statements represent Jervois’ current views regarding future events and are necessarily based on a number of assumptions and estimates which, although considered reasonable by Jervois, are inherently subject to commercial, economic, competitive, political risks. and social, important contingencies and uncertainties. . Many factors, known and unknown, could cause any results, performance or achievement to differ materially from the results, performance or achievements which are or may be expressed or implied by these forward-looking statements. Jervois does not intend, and assumes no obligation, to update such forward-looking statements or information to reflect changes in assumptions or changes in circumstances or any other event affecting such statements and information other than those required. by applicable laws, rules and regulations.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Schedule a –

1 Equivalent to US $ 8.9 million at USD / BRL exchange rate of 5.35