Power to appoint receiver over Ultra Lithium debt Power Minerals Limited (ASX: PNN, Power or the Company) advises that it is commencing the process to appoint a receiver to Ultra Lithium Inc. (TSXV: ULT) (Ultra Lithium) to recover the full amounts outstanding under a convertible loan agreement (CLA) between the two companies (original CLA ASX announcement 16 May 2023). Power has appointed Hall Chadwick in Western Australia as a key advisor to manage the debt recovery process. Hall Chadwick will assist with engaging Canadian-based insolvency firms to appoint a receiver to Ultra Lithium and recover the debt. When appointed, the receiver may exercise Power’s CLA rights to either enforce the securities interests by sale of Ultra Lithium’s assets or convert the debt into Ultra Lithium shares. Power remains open to a settlement of the amounts outstanding under the CLA prior to the receivership process commencing. Power also remains committed to ensuring that its rights under the CLA and the associated securities interests are maintained and enforced. Background Power Minerals and Ultra Lithium entered into a binding term sheet on 11 May 2023 (BTS) which contemplated the entry into the CLA. Power attempted to complete the BTS transaction, however as per PNN ASX announcement dated 19 July 2023, Power confirmed that it had identified key matters of concern, which, in conjunction with Ultra Lithium’s lack of substantive engagement in respect of the BTS transaction, had caused serious concerns as to whether the BTS transaction would complete. Under the CLA, Power advanced an interest-bearing loan of AUD $1.13 million to Ultra Lithium on 12 May 2023. The loan, together with accrued interest, was repayable on demand by Power by the issue of shares in Ultra Lithium Inc. or in cash at any time after 30 June 2024. On 25 October 2023, Power received a part payment of AUD $150,000 under the CLA. The balance of the loan amount plus accruing interest has continued to remain unpaid. As such, Power recently initiated steps to secure the full repayment of the amounts outstanding under the CLA.
LKE Price at posting:
3.9¢ Sentiment: Sell Disclosure: Not Held
