Arianne extends credit facilities with Mercury

Executive Summary

• Arianne Phosphate Inc. closed an amended and restated senior secured credit agreement with Mercury Financing Corp., extending three existing facilities to a total of $24.48 M maturing on 30 Sept 2027.
• The transaction involved the issuance of 7,539,515 common shares (partial cash consideration) and a further 10 M common shares subject to voluntary hold periods, plus 25 M non‑transferable warrants at $0.28 per share.
• Mercury gains board representation rights, a production fee of $0.25 per tonne of phosphate concentrate for the life of the project (repurchasable for $2.25 M), and potential ownership up to ~16.6 % on a partially diluted basis if all warrants are exercised.

Key Details

• Credit Facilities: Aggregate principal amount $24,477,128; interest rate 8 % per annum, capitalized to maturity.
• Share Issuance – Accrued Interest Payment:
• 7,539,515 common shares issued to cover accrued interest up to 31 Mar 2026.
• 7,118,742 shares sold at $0.26 each (interest from 1 Apr 2025‑11 Mar 2026).
• 420,773 shares sold at $0.255 each (interest from 12 Mar 2026‑closing).
• Equity Issuance – Additional Shares:
• 10 M common shares issued to Mercury.
• Voluntary hold periods: 5 M shares – 6 months; 5 M shares – 9 months from closing.
• Hold periods may be shortened by a subsequent equity financing or terminated upon a merger/acquisition.
• Warrants:
• 25 M non‑transferable common share purchase warrants, exercisable at $0.28 per share until 30 Sept 2027.
• Exercise limited to keep Mercury’s ownership ≤19.9 % on a partially diluted basis, unless a business combination occurs.
• Board Rights: Mercury may designate a nominee to the Arianne board and that nominee will sit on the Human Resources & Corporate Governance Committee for as long as the loan remains outstanding.
• Production Fee: Additional fee of $0.25 per metric tonne of phosphate concentrate sales for the project life, payable to Mercury; can be repurchased by Arianne for a lump‑sum $2.25 M at any time. Same fee applies if full repayment is not made by 31 Mar 2027.
• Regulatory Hold: Interest‑payment shares, the 2026 equity issuance and warrants are subject to a regulatory hold expiring 1 Aug 2026; transaction pending final TSX‑V approval.
• Post‑Closing Ownership (early warning):
• Mercury beneficially owns 17,539,515 common shares (~7.6 % non‑diluted).
• Plus 25 M warrants; if exercised, total potential ownership rises to 42,539,515 shares, ~16.6 % partially diluted.
• Future Flexibility: Mercury may acquire additional securities in the open market at any time and may dispose of holdings as it sees fit.

Notable Quotes

(No direct CEO/President quotes were included in the release.)