Nevada Copper announces transformative improvement in its balance sheet



YERINGTON, Nevada, Oct 12, 2021 (GLOBE NEWSWIRE) – Nevada Copper Corp. (TSX: NCU) (OTC: NEVDD) (“Nevada Copper” or the “Company”) today announced that it has entered into an agreement with its principal project lender and a non-binding list of conditions with its principal shareholder to provide a additional financing and a significant deferral and extension of its borrowing facilities, providing significantly greater balance sheet flexibility and support for the completion of the ramp-up of its mining operation and subsequent advancement of its project surface mine and broader property exploration targets.

Strong points

Randy Buffington, CEO of the company, said: “These combined improvements to the balance sheet provide an important additional lead for the Company as we move towards completing the ramp-up of our underground operations. The continued support from two of our key stakeholders provides further validation of the significant intrinsic value of our Nevada copper operations and allows us to continue to pursue the growth potential built into our asset base. ”

More details

Extension of the senior project facility

The Company has entered into the following modifications to its amended and restated credit facility (the “KfW Facility”) with its principal lender, KFW-IPEX Bank:

For these changes, a 0.25% change fee is payable 90 days after the facility changes close, and an additional 0.75% is payable after the project completion test.

A condition precedent to the modification of the facility is the receipt by the Company’s wholly-owned subsidiary, Nevada Copper, Inc., of at least US $ 40 million in net debt or equity financing proceeds (the “KfW condition”). If fully utilized, the Modified Credit Facility would meet this condition.

Consolidation and extension of shareholder loans

Along with securing the changes to the KfW facility, the Company has entered into a non-binding term sheet with Pala Investments Limited (“Pala”), the Company’s largest shareholder, providing that all loan promissory notes are The outstanding shareholder will be consolidated under the current credit facility previously provided by Pala to the Company on February 3, 2021. The amended credit facility will reflect the following changes:

  • The Amended Credit Facility will be increased to US $ 138 million, with the use of funds to include:

    • Additional liquidity of US $ 41 million (the “Additional Tranche”), which, if fully utilized, would satisfy the conditions precedent of the Amended KfW Facility; and

    • Repayment of all other outstanding shareholder loans in the form of promissory notes;

  • Maturity date extended by two years until 2026 under the amended credit facility, with no payment expected before final maturity; and

  • No change to existing interest rates or other material terms of the amended credit facility.

In connection with these changes, a modification and extension fee of 4% of the principal amount of the Amended Credit Facility, excluding the Additional Tranche, will be payable at the closing of the Amended Credit Facility, this commission to be capitalized on the Amended Balance Credit Facility. A 2% disbursement charge will apply to the amounts of the Additional Tranche which are drawn by the Company and will be capitalized on the balance of the Amended Credit Facility at the time of such drawings. Fifteen million common share purchase warrants will be issued to Pala, exercisable until the maturity of the amended credit facility, at an exercise price equal to the lesser of a 25% premium to the average market price. 5-day volume weighted stock of the Company’s shares immediately prior to the close of the amended credit facility, or a 25% premium over the 5-day volume weighted average price of the Company’s shares immediately thereafter announcing the offer price of any equity financing that the Company may pursue prior to the closing of the Amended Credit Facility.

If the Company completes one or more equity financings in the future, Pala will have the right to capitalize and / or convert up to US $ 35 million of outstanding principal loans under the amended credit facility into new ones. ordinary shares of the Company under the same conditions such financing.

The terms of the amended credit facility have been reviewed and approved by the independent directors of the Company. Closing of the Amended Credit Facility is subject to final documentation negotiation and TSX approval. There can be no assurance that final documentation relating to the Amended Credit Facility described above will be completed. If the Amended Credit Facility is not concluded, the Company will need further financing to be able to meet the KfW Condition.

About Nevada Copper

Nevada Copper (TSX: NCU) is a copper producer and owner of the Pumpkin Hollow copper project. Located in Nevada, USA, Pumpkin Hollow has significant reserves and resources, including copper, gold, and silver. Its two fully licensed projects include the high-grade underground mine (the “underground mine”) and processing facility, which is now in production, and a large-scale surface mine project, which is progressing towards the feasibility status.

NEVADA COPPER CORP.
www.nevadacopper.com
Randy Buffington, President and CEO

For more information contact:
Rich Matthews, Investor Relations
Full communications
[email protected]
+1 604 757 7179

Warning language

This press release includes certain statements and information that constitute forward-looking information within the meaning of applicable Canadian securities laws. All statements contained in this press release, other than statements of historical fact, are forward-looking statements. These forward-looking statements and forward-looking information specifically include, but are not limited to, statements relating to the Amended Credit Facility, including the terms thereof, and the satisfaction of the KfW Condition.

Forward-looking statements and information include statements regarding the expectations and beliefs of management. Often, but not always, forward-looking statements and forward-looking information can be identified by the use of words such as “plans”, “expects”, “potential”, “is expected”, “anticipated”, “is targeted ”,“ budget ”,“ planned ”,“ estimates ”,“ forecasts ”,“ intention to ”,“ foresees ”or“ believes ”or the negative aspects thereof or variations of these words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “could” or “will” be taken, occur or be achieved. Forward-looking statements or information should not be interpreted as guarantees of future performance and results. They are subject to known and unknown risks, uncertainties and other factors which may cause actual results and events to differ materially from future results, performance or achievements expressed or implied by such forward-looking statements or information.

These risks and uncertainties include, but are not limited to, those related to: the Company’s ability to complete the ramp-up of the underground mine on time and on estimated costs; additional capital requirements and no assurance can be given as to their availability; the impact of the COVID-19 pandemic on the Company’s business and operations; the state of financial markets; loss history; dilution; adverse events related to grinding operations, construction, development and ramp-up, including the Company’s ability to resolve underground development and processing plant issues; failure to secure the effective date of extensions and modifications to the Company’s Amended and Restated Senior Credit Facility with KfW IPEX-Bank; failure to enter into the Amended Credit Facility; soil conditions; cost overruns related to the development, construction and ramp-up of the underground mine; loss of material properties; interest rates rise; Mondial economy; limited history of production; future fluctuations in metal prices; speculative nature of exploration activities; periodic interruptions of exploration, development and mining activities; environmental risks and liability; work accident; failure of processing and mining equipment to perform as intended; labor disputes; supply problems; uncertainty of production and cost estimates; interpretation of drilling results and estimation of mineral resources and reserves; changes in project parameters as plans continue to be refined; possible variations in ore reserves, mineralization grade or recovery rates from management expectations and the difference may be material; legal and regulatory proceedings and community actions; accidents; title matters; regulatory approvals and restrictions; increasing costs and physical risks associated with climate change, including extreme weather events, and new or revised climate change regulations; permits and licenses; volatility of the market price of the Company’s securities; Assurance; competetion; hedging activities; currency fluctuations; loss of key employees; other mining industry risks as well as the risks discussed in the Company’s management report for the year ended December 31, 2020 and in the section entitled “Risk Factors” of the Company’s annual information form dated December 18, 2020. March 2021. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove to be incorrect, actual results could differ materially from those described in the forward-looking statements or information. Forward-looking information or statements are made as of the date hereof. Nevada Copper disclaims any intention or obligation to update any forward-looking statements or information, except as required by law. Readers are referred to additional information regarding Nevada Copper’s business contained in Nevada Copper’s reports filed with securities regulatory authorities in Canada. Although the Company has attempted to identify material factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that could cause actions, events or results are not as expected, estimated or expected. For more information on Nevada Copper and the risks and challenges facing its business, investors should consult the documents filed by Nevada Copper which are available at www.sedar.com.

Nevada Copper provides no assurance that forward-looking statements and information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements or information. Therefore, readers should not place undue reliance on forward-looking statements or information.


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