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Nevada Copper Announces Red Kite Funding Commitment

May 31, 2016, 07:53 AM
Filed Under: Metals and Mining

Nevada Copper Corp. announced that its senior secured lender, EXP T1 Ltd., an affiliate of Red Kite Mine Finance has agreed to certain amendments to the senior loan agreement between the Company and Red Kite which waive all existing defaults under the senior loan facility, on the following basis:

  • Red Kite has waived the existing defaults under its loan facility with the Company and lifted the forbearance under which the Company has been operating;
  • The requirement for the Company to complete a minimum US$10 million financing has been waived;
  • Red Kite will advance to the Company an additional US$3 million draw under the current loan facility; and
  • The working capital covenant under the loan facility will be amended such that the Company will be required to maintain minimum working capital of US$100,000.

The continuance of the foregoing waivers and the completion of the drawdown and amendments is subject to the receipt by the Company, on or before June 7, 2016, of the U.S. $5 million additional drawdown under the Company's subordinated convertible loan agreement with Pala Investments Ltd. ("Pala"), which was announced in the Company's news release dated April 22, 2016. The Pala convertible debt is subject to a vote of disinterested shareholders at the Annual and Special Meeting of the shareholders of the Company to be held today (May 27, 2016).

The Company expects to close the U.S. $5 million of Pala convertible debt draw and the Red Kite U.S. $3 million debt draw on or about June 3, 2016. The funds will be used to maintain the Pumpkin Hollow property permits and licences in good standing, and evaluate opportunities for enhancing project economics in a lower copper price environment.

Nevada Copper also announces that the terms of its previously-announced public offering of subscription receipts are to be changed to a common share offering. The Company intends to raise an aggregate of up to CDN$4 million (the "Offering") by the issuance of an aggregate of up to 6,666,667 common shares (the "Shares") at a purchase price (the "Issue Price") of CDN$0.60 per Share, subject to an over-allotment option as described below. The Company intends to file an amended and restated preliminary short form prospectus in connection with the Offering forthwith. occur on or about June 9, 2016.

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