Bluelake Mineral

Decision on approval of the board's decision on a directed issue of convertibles

The EGM decided to approve the board's decision dated February 12, 2024 whereby the Company shall raise a convertible loan in an aggregate nominal amount not exceeding SEK 10,000,000 through the issuance of not more than 10,000,000 convertible debentures, entailing an increase in the share capital of not more than SEK 2,000,000 upon full conversion of the convertible debentures. The resolution shall otherwise be governed by the following terms and conditions.

The right to subscribe for the convertibles shall accrue to Formue Nord Fokus A/S. The reason for the deviation from the shareholders' preferential right is to ensure the most effective financing for the repayment of the Company's outstanding convertible loan of SEK 8,000,000 that the Company took out in April 2023 and which is due for payment on October 12, 2024 (the "Claim") as well as to strengthen the financing of of all liceces for the restart of mining activities in Joma in the municipality of Røyrvik in Norway (the "Project"). Through the directed issue convertible debentures, the current, outstanding convertible loan is replaced with a new convertible loan which, among other things, means extended debt financing for the Company. The board has considered the possibility of financing the repayment of the loan by carrying out a rights issue of shares or through a rights issue of convertibles. The board has concluded that a rights issue would entail significantly longer implementation time and thus an increased market risk exposure. The reduced time required for the issue process means, among other things, a reduced exposure to this market risk, and that the Company's management can focus more quickly on the Company's continued development. In addition, the costs for the directed issue of convertible debentures are deemed to be significantly lower than in the case of a rights issue. It is the board's assessment that a rights issue in the current market climate would probably require greater guarantee commitments from a guarantee consortium, which would entail further additional costs for the shareholders. In light of the above, it is the board's overall assessment that the directed issue of convertible debentures constitutes the most effective financing of the repayment of the Company's debt and to strengthen the financing of the Project and is beneficial for the Company and its shareholders.

The nominal amount of the convertible debentures shall be SEK 1 or multiples thereof. The loan carries a yearly interest rate of twelve (12) per cent plus Stibor 3 months, payable quarterly and on the final maturity date. Accrued interest must be paid in cash. The subscription price shall be equal to 95 percent of the nominal amount of the convertible debentures. The aggregate subscription price for all convertible debentures thereby amounts to SEK 9,500,000. The subscription price has been negotiated on an arm's length basis with Formue Nord Focus A/S and is considered by the board - in light of the negotiations - to be in line with market conditions. Payment for the newly issued convertibles must be made partly by offsetting the Claim, partly by a cash payment of SEK 1.5 million. The Claim is thus, through the isuue, settled with a new convertible loan which, among other things, means extended financing for the Company up until June 30, 2025. 

The convertible debentures may be converted into shares during the period from the date of registration of the convertible debentures with the Swedish Companies Registration Office up to and including June 30, 2025, at a conversion price of SEK 1.20. In the event that the Company carries out a directed issue of shares at a discount that exceeds ten (10) percent compared to the average last price paid for the Company's share during the ten (10) trading days immediately preceding the decision date for the new issue, the convertible holder has the right to, during a 10- day period, convert all convertibles at a conversion price corresponding to the issue price in the directed issue, however at least at a conversion price of SEK 0.50. The full terms and conditions for the convertible debentures are kept available at the Company's website.

Authorization

The EGM decided to authorize the board to, with deviation from the shareholders' preferential rights, until the time of the next annual general meeting, on one or more occasions, decide on a new issue of shares, warrants and/or convertibles, which may result in a total increase in the number of shares in the Company with a maximum 21,000,000 shares (upon full subscription with the support of such warrants and/or full conversion of such convertibles and before any recalculation according to the terms of the warrants and/or convertibles). If the authorization is fully used, the dilution amounts to approximately 20 percent. 

Other

For more detailed information on the content of the resolutions, please refer to the notice convening the EGM that is available on the Company's website.

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Stockholm, February 2024
Bluelake Mineral AB (publ)
The Board of Directors 

Stockholm February 29, 2024