The funds are being provided by Arena Investors LP, a major U.S. based institutional investor with more than US$750 million in assets under management.
Adrian Griffin, managing director, said: "Lithium Australia has previously announced its intention to proceed with the large-scale Sileach® pilot plant program, and its intention to recommission the Very Small Particle Company cathode pilot plant.
"The Arena facility is a major element of the funding package required for these endeavours to be successfully implemented."
The company recently demonstrated confidence in its SiLeach® lithium recovery technology by committing to build a large-scale pilot plant.
Lithium Australia expects to complete agreements this quarter resulting in supply of the plant site, infrastructure, reagent supplies and process feed material.
READ: Lithium Australia enters high-margin end of battery metals market after completing acquisition
The company also made a move to enter the high-margin end of the battery metals market after completing the acquisition of Very Small Particle Company (VSPC).
The acquisition provides Lithium Australia with exposure to the manufacture of cathode powders, which is the most profitable process step in the battery production cycle.
Multi-tranche convertible note facility
The convertible notes to be issued to Arena Investors have a face value of $21 million and will be issued at a discount of 13%. The notes are unsecured and will be drawn-down in six separate tranches.