Nautilus receives additional bridge loans
February 08 2018 - 7:00AM
Nautilus Minerals Inc. (TSX:NUS) (OTC:NUSMF) (the
"
Company" or "
Nautilus")
announces that it continues to arrange bridge loans from Deep Sea
Mining Finance Ltd. (the "
Lender"), which are
expected to form part of a larger secured structured credit
facility of up to US$34 million to be provided by the Lender to the
Company.
Mike Johnston, Nautilus’ CEO commented: “We are
very pleased with ongoing support we are receiving from our largest
shareholders with these bridge loans. We also continue to work with
M. Horn & Co. Ltd., in respect of the remaining project
financing of up to US$350 million required to complete the
development of the Solwara 1 Project.”
To date the Company has received bridge loans
from the Lender totaling US$4,750,000. In conjunction with the most
recent advance of US$2,000,000, the Company has issued to the
Lender an additional 8,591,065 warrants of the Company (the
"Warrants"), for a total of 20,403,779 share
purchase warrants issued to the Lender to date. Each Warrant
entitles the Lender to purchase one common share of the Company at
a price of C$0.17 for a period of five years from the date of
issuance of the Warrant.
The bridge loans, which the Company expects to
be in the aggregate amount of up to US$7 million, will assist the
Company's immediate working capital requirements and facilitate
payments required to continue the development of the Company's
seafloor production system to be first utilized at the Company's
Solwara 1 Project. The loans bear interest at 8% per annum, payable
bi-annually in arrears with a one year maturity date.
The Company will be entitled to pre-pay each
loan prior to maturity, by paying 108% of the outstanding principal
of the loan plus accrued and unpaid interest. Each loan will be
represented by a promissory note and will initially be secured
against the assets of the Company through a general security
agreement. The Lender may subsequently require the loan to be
guaranteed by the Company's material operating subsidiaries and
secured against the assets of such subsidiaries.
As previously disclosed, the Lender is a private
company owned 50% by each of: (i) USM Finance Ltd., a wholly owned
subsidiary of USM Holdings Ltd, an affiliate of Metalloinvest
Holding (Cyprus) Limited; and (ii) Mawarid Offshore Mining Ltd., a
wholly-owned subsidiary of MB Holding Company LLC. As the Lender is
controlled by two insiders of the Company, the Lender is a "related
party" of the Company and the loan transaction constitutes a
"related party transaction" of the Company under MI 61-101
Protection of Minority Security Holders in Special Transactions
("MI 61-101"). The transactions comprising the
bridge loans and the Warrants will be exempt from the formal
valuation and minority shareholder approval requirements of MI
61-101.
The Company did not file a material change
report more than 21 days before the expected closing of this
transaction, as the details of the transaction were not finalized
until immediately prior to the closing and the Company wished to
close the transaction as soon as practicable for sound business
reasons.
The Company requires significant additional
funding in order to complete the build and deployment of the
seafloor production system to be utilized at the Solwara 1 Project
by the Company and its joint venture partner (as to 15%), the
Independent State of Papua New Guinea's nominee.
There can be no assurances that the Company will
be successful in securing the necessary additional financing
transactions within the required time or at all. Failure to secure
the necessary financing may result in the Company undergoing
various transactions including, without limitation, asset sales,
joint ventures and capital restructurings.
The Company will provide further updates as
circumstances warrant.
Links
http://www.nautilusminerals.com/irm/PDF/1951_0/Nautilusprovidesfundingupdate
http://www.nautilusminerals.com/irm/PDF/1950_0/Nautilusarrangesbridgeloansandsignsnewfundingmandate
For more information please refer to
www.nautilusminerals.com or contact:
Investor Relations
Nautilus Minerals Inc. (Toronto) Email:
investor@nautilusminerals.com Tel: +1 416 551 1100 |
|
The TSX does not accept responsibility
for the adequacy or accuracy of this press release.
Certain of the statements made in this news
release may contain forward-looking information within the meaning
of applicable securities laws, including statements with respect to
the Company's funding requirements, expectations to receive
additional bridge loans and enter into a credit facility, and the
continued development of the Solwara 1 Project. We have made
numerous assumptions about such statements, including
assumptions relating to the Company’s funding
requirements, project funding, and completion and
operation of the Company's seafloor
production system. Even though our
management believes the assumptions made
and the expectations represented by such statements are
reasonable, there can be no assurance that they will prove to be
accurate. Forward-looking information by
its nature involves known and
unknown risks, uncertainties and
other factors which may cause the actual results to be
materially different from any future results expressed or implied
by such forward-looking information. Please
refer to our most recently
filed Annual Information Form in
respect of material assumptions and risks related to
the prospects of extracting minerals from the seafloor and other
risks relating to the Company's
business and plans for development
of the Solwara 1 Project. Risks
related to continuing the Company's operations and advancing the
development of the Solwara 1 Project include the risk that the
Company will be unable to obtain at all or on acceptable terms, and
within the timeframes required, the remaining financings necessary
to fund completion of the build, testing and deployment of the
Company's seafloor production system and that agreements with third
party contractors for building slots within certain timeframes are
not secured as required. As the Company has
not completed an economic study
in respect of the Solwara 1
Project, there can be no assurance
that the Company's production plans will, if fully funded and
implemented, successfully demonstrate that seafloor resource
production is commercially viable. Except as required by law, we do
not expect to update forward-looking statements
and information as conditions change
and you are referred to the
full discussion of the Company's
business contained in the Company's
reports filed with the securities
regulatory authorities in Canada.
About Nautilus Minerals Inc. Nautilus is the
first company to explore the ocean floor for polymetallic seafloor
massive sulphide deposits. Nautilus was granted the first mining
lease for such deposits at the prospect known as Solwara 1, in the
territorial waters of Papua New Guinea, where it is aiming to
produce copper, gold and silver. The Company has also been granted
its environmental permit for this site. Nautilus also holds highly
prospective exploration acreage in the western Pacific (granted and
under application), as well as in international waters in the
Central Pacific. A Canadian registered company, Nautilus is listed
on the TSX:NUS stock exchange and is also a member of the Nasdaq
International Designation program. Its corporate office is in
Brisbane, Australia. Its major shareholders include MB Holding
Company LLC, an Oman based group with interests in mining, oil
& gas, which holds a 29.3% interest and Metalloinvest, the
largest iron ore producer in Europe and the CIS, which has a 18.5%
holding (each on a non-diluted basis, excluding loan shares
outstanding under the Company’s share loan plan).