15 Mar 2023
Zinc8 Energy Solutions Inc. ("Zinc8" or the "Company") (CSE: ZAIR) (OTC: ZAIRF) (FSE: 0E9) is pleased to announce the approval from the Ulster County Industrial Development Agency ("UCIDA") of the issuance of tax-exempt revenue bonds for up to US$10 million to undertake the buildout and completion of Zinc8's first commercial manufacturing facility within Ulster County, New York.
The proceeds from the US$10 million are expected to be utilized for the acquisition of machinery, equipment, fit-up and improvements to the facility.
"I am extremely thankful for the support shown from the people of Ulster County, and I personally want to thank the Board Members of the Ulster County IDA who have expressed their support for Zinc8 Energy Solutions to locate in their community," said Ron MacDonald, CEO and President of Zinc8 Energy Solutions. "Our company is very grateful for the issuance of the US$10 millionrevenue bond, as it supports the company's long-term plan to make Ulster County Zinc8's US base for assembly and manufacturing of our Zinc-air Energy Storage systems."
The mission of the UCIDA is to advance the job opportunities, general prosperity and long-term economic vitality of Ulster County residents by utilizing tax incentives, municipal bonds and other forms of financial assistance to foster the creation and attraction of new business and the retention and expansion of existing business within Ulster County, New York.
Once a lease has been entered into for the Company's inaugural manufacturing facility in the United States, the Company expects that additional financial investment will need to be made into the facility over the first three years after taking possession. The Company is currently reviewing the capital requirements to fund the buildout of the manufacturing facility and will provide any updates as they arise.
"This bond combined with the US$9 Million tax incentive package recently awarded to Zinc8 by Governor Hochul through the Excelsior Jobs Program, is expected to cover a substantial portion of the initial investment into the plant," added MacDonald. "The support that has been shown for Zinc8's energy storage technology and the clean energy sector from all three levels of the US government, at the municipal level through the Ulster County IDA, at the state level through the Governor of New York and Empire State Development and federally by Senator Schumer and through legislation such as Section 45X of the Inflation Reduction Act (United States) (the "IRA") is encouraging for the Company. We look forward to working closely with members of the UCIDA over the coming months as we play our role in helping the great State of New York accelerate their ambitious climate change initiatives."
The Company continues to work diligently towards securing a lease for it manufacturing facility in Ulster County and pursuing options for financing the manufacturing facility build out, completion of ongoing product demonstrations, commercialization of the Zinc8 battery products, and ongoing working capital requirements. Additional funding will be required beyond the municipal bond and tax incentives in order to fund the build out of the manufacturing facility and commercialization of the Company's product through the first three years after the Company secures possession of a manufacturing facility. As noted above, the Company is still reviewing the financial requirements and required funding to buildout the manufacturing facility. The Ulster County tax-exempt municipal bonds are subject to various terms and conditions, including limitations on the use of funds and repayment terms. In connection with the issuance of the municipal bonds, the Company has engaged KeyBanc Capital Markets Inc. ("KBCM") as placement agent to place the bonds with eligible investors in accordance with applicable securities laws. The terms of the placement of the bonds have not yet been determined, and the Company expects placement fees to be paid to KBCM in connection with the placement of the bonds. Upon settlement of the terms of the placement of the bonds, the Company will provide such terms in a future release.
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