Replenish Nutrients Secures $15M Strategic Investment and Carbonatite Supply Deal

Source: Proactive

Tickers: ERTH.CN | 7KE.F | ERTH | VVIVF

Replenish Nutrients Holding Corp (CSE:ERTH, OTC:VVIVF, FRA:7KE) has secured a $15 million strategic investment from SRC Agrominerals to expand its Beiseker fertilizer facility and secure a long-term supply of carbonatite, a mineral-rich input for its regenerative fertilizer products.

Investment Structure

Under the agreement, SRC will invest:

• $7.5 million through the purchase of 50 million units at $0.15 per unit, granting an initial 19.9% stake in Replenish on a non-diluted basis. Each unit includes a common share and half of a warrant, with each whole warrant exercisable at $0.225 for four years, subject to acceleration if shares trade at or above $0.28 for twenty consecutive trading days.
• $7.5 million through a senior secured convertible debenture bearing 10% annual interest, payable quarterly in cash or shares at Replenish's election. The debenture matures in four years and converts at $0.225 per share.

Use of Proceeds

Funds will support:

• A new 150,000 metric tonne pelletizing facility at Replenish's existing Beiseker site in Alberta
• Additional storage, load-out, and processing infrastructure

The expansion is expected to be completed in the first quarter of 2028 and is projected to carry gross margins of 25% to 35%.

Supply Agreement

Replenish and SRC will enter a 10-year supply agreement under which Replenish will purchase a minimum annual quantity of carbonatite — a resource rich in calcium, phosphorus, and trace minerals used for soil enhancement — for incorporation into its fertilizer products. Initial payment terms include $1 million upon execution of the agreement.

Leadership Changes

• Tim Close, CEO of SRC, will join Replenish's board of directors following the closing of the equity investment. Close previously led Ag Growth International for a decade, during which the company's revenue grew fivefold.
• David Morris, founder and former chairman of Morris Group Canada, will join as a board advisor and will be nominated as a director at Replenish's next annual shareholder meeting.

Executive Commentary

"This strategic relationship marks a pivotal step in Replenish's growth strategy. SRC's investment gives us the capital to accelerate our Beiseker pelletizing expansion, while our new supply agreement gives Replenish access to a key input for our regenerative fertilizer platform." — Neil Wiens, CEO, Replenish Nutrients

"Replenish has built a capital-efficient, scalable platform for regenerative fertilizer production, and this investment reflects our confidence in their team and their growth trajectory." — Tim Close, CEO, SRC Agrominerals

Timeline and Market Reaction

• Closing of the equity investment is expected by July 24
• The debenture investment is expected to close by mid-August
• Shares of Replenish rose 15% on the announcement