Homerun Resources Inc. Announces up to $15 Million Convertible Security Financing with Lind Partners Under Engagements with Benchmark/Stonex
Homerun Resources Inc. (HMR) has announced a convertible security funding agreement with The Lind Partners for up to C$15 million. The transaction consists of an initial C$2 million tranche and up to C$13 million in optional follow-on capital. The financing is intended to provide near-term working capital while serving as a bridge to larger-scale strategic financings and a potential future uplisting to a senior exchange.
The initial tranche carries a 24-month term with a six-month repayment holiday, followed by monthly cash repayments. The structure features a fixed conversion price of C$0.66, which represents a 10% premium to the pre-announcement market price, and includes 50% warrant coverage. The total financing size is capped at C$15,000,000, with the initial tranche comprising a C$2,000,000 principal amount and a face value of C$2,200,000, which includes C$200,000 in pre-paid interest. The follow-on capital of up to C$13,000,000 is available subject to mutual agreement and applicable approvals.
Repayment of the initial tranche is structured with a six-month repayment holiday, followed by monthly cash repayments of C$111,111 from months 7 through 24. Interest accrues at C$16,667 per month for the first 12 months following closing, followed by 10% per annum on outstanding principal commencing on the first anniversary of closing. The company has the option to pay accrued interest via shares for debt at market price, subject to TSXV approval. Homerun also holds a one-time right to repurchase outstanding principal and pre-paid interest at a 3% premium after the statutory hold period expires.
The security is senior secured, backed by a general security agreement over Homerun’s assets and a pledge of shares in Homerun’s subsidiaries. The company issued 1,600,000 warrants to Lind, representing 50% warrant coverage on the Initial Tranche. These warrants are exercisable for 36 months with an exercise price of C$0.7980, which is 133% of the market closing price on the day prior to the announcement.
The Benchmark Company, LLC, a subsidiary of StoneX, acted as the exclusive placement agent for the transaction, while StoneX Group Inc. served as the non-exclusive financial advisor. The placement agent compensation includes a 7.0% cash fee and 7.0% of gross proceeds in common shares, with a share price of $0.60 for the Initial Tranche.
Brian Leeners, Chief Executive Officer, commented on the deal: "This financing and the investment banking partnerships with both Benchmark and StoneX provide Homerun with near-term working capital while preserving flexibility as we advance discussions around larger-scale strategic and institutional funding initiatives. We view this as a bridge to broader financing opportunities that supports our long-term growth objectives and uplisting plans, while seeking to manage dilution for our existing shareholder base."