Walkabout Resources Ltd
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Why is Walkabout Resources Receiving Additional Investment?
On 13 November 2023, Walkabout Resources Ltd (ASX:WKT) announced that it has received an additional investment of US$700,000 from Battery Metals Capital Group, LLC (BMCG). This investment is a result of BMCG exercising its right to accelerate a portion of the Standby Financing agreement between the two companies. As a part of this investment, Walkabout Resources will issue 13,705,405 shares to BMCG.
What is Standby Financing?
Standby Financing is a financial agreement that provides a company with access to funding when needed. In the case of Walkabout Resources, the Standby Financing agreement with BMCG allows the company to draw on additional funds if required. However, for this particular investment, no further shares will be issued, and BMCG does not have the right to accelerate any more of the financing.
Why Doesn't Walkabout Resources Intend to Draw on the Standby Financing?
According to the company, Walkabout Resources does not currently plan to use the remaining funding from the Standby Financing agreement.
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The company believes that its existing Senior Debt facility will be sufficient to meet its funding needs until the anniversary date of the agreement.
Conclusion of Share Issuance to BMCG
With the issuance of shares to BMCG as a result of this investment, Walkabout Resources has fulfilled its obligation to issue shares to BMCG. Any future drawdowns of the Standby Financing and corresponding share issuances will be at the discretion of the company.
Importance of BMCG Standby Financing
Andrew Cunningham, the Managing Director & CEO of Walkabout Resources, emphasized the critical role played by the BMCG Standby Financing. This financing has provided comfort to the company's contractors regarding the repayment of vendor interim finance. Cunningham also acknowledged that Walkabout Resources would not have achieved its current success without the important support from BMCG.
In summary, Walkabout Resources Ltd has received additional investment from BMCG through the acceleration of Standby Financing. While the company does not currently plan to draw on this financing, it acknowledges the crucial support provided by BMCG in the past.
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