TORONTO, ONTARIO--(Marketwired - Feb. 27, 2017) - Pala Investments Limited ("Pala") is pleased to announce that on February 24, 2017, it reached an agreement with Nevada Copper Corp. ("NCU") regarding the amendment of its existing convertible loan facility to NCU (the "Convertible Loan Facility") and the advance of a further US$5,000,000 (less an arrangement fee and expenses) (the "Advance") under the Convertible Loan Facility. The amendments extended the maturity of the Convertible Loan Facility from January 10, 2018 to December 31, 2018.
The Advance, and all interest accrued thereon, is convertible at a conversion price of the lower of C$0.90 and 115% of the lowest subscription price of Common Shares issued by the Borrower in connection with any equity financing completed within six months of February 24, 2017. The existing loans under the Convertible Loan Facility, and all interest accrued thereon, remain convertible at a price of C$0.69. Notwithstanding the foregoing, the Advance and the interest accrued thereon, as well as interest accrued on the existing loans after December 31, 2017 will not be convertible until the receipt of shareholder approval of such conversion by NCU.
Upon the closing of the funding of the Advance, Pala will also be issued warrants exercisable for 2,500,000 NCU Shares (the "New Warrants") pursuant to a warrant agreement with a 3-year term, exercisable to acquire NCU Shares at an exercise price of C$0.97 per share.
Funding of the Advance is subject to customary conditions precedent including receipt of approval of the Toronto Stock Exchange.
After funding of the Advance and assuming an exchange rate of C$1.3104 for each US$1.00 (the noon rate as of February 24, 2017, as published by the Bank of Canada), the Advance would be convertible into a total of 7,280,000 NCU Shares (upon obtaining shareholder approval) and the New Warrants will be exercisable for an additional 2,500,000 NCU Shares, together representing an increase of approximately 2.04% in Pala's securityholding percentage in respect of the NCU Shares (based on 88,168,125 NCU Shares currently outstanding).
Pala currently holds 40,289,141 NCU Shares, $29,549,377.38 of existing loans under the Convertible Loan Facility and warrants to purchase an additional 2,500,000 NCU Shares (the "Existing Warrants"). Subject to the assumptions set forth above, following the conversion of all amounts under the Convertible Loan Facility and the exercise in full of the Existing Warrants, Pala would hold a total of 98,907,262 NCU Shares, representing approximately 67.38% of the then issued and outstanding NCU Shares (based on 88,168,125 NCU Shares currently outstanding).
After funding of the Advance and subject to the assumptions set forth above, following the conversion of all amounts outstanding under the Convertible Loan Facility and the exercise in full of the Existing Warrants and the New Warrants, Pala would hold a total of 108,687,262 NCU Shares, representing approximately 69.42% of the then issued and outstanding NCU Shares (based on 88,168,125 NCU Shares currently outstanding).
Pala has acquired these securities for investment purposes and may increase or decrease the investment in the securities of NCU depending on its evaluation of the business, prospects and financial condition of NCU, the market for NCU's securities, general economic and tax conditions and other factors.
Pala has the right to nominate up to three members of the Board of Directors of NCU, subject to Pala maintaining certain share ownership thresholds, and three nominees of Pala currently serve on NCU's Board of Directors. Pala may, subject to the terms and conditions of its nomination rights, replace its nominee directors from time to time depending on its evaluation of considerations relating to the composition of NCU's Board of Directors, the willingness of its nominees to serve as directors of NCU and other factors.
Pala's address is 12 Castle Street, St. Helier, Jersey JE2 3RT. For further information, please refer to the Early Warning Report posted on SEDAR or contact John Nagulendran at +41 41 560 9070.
Pala is an investment company focused exclusively on the mining sector with a strong track record of successful investments and value creation. Pala's team has extensive experience within the sector and seeks to assist companies in which it has long-term shareholdings by providing strategic advice and innovative solutions in development, production, turnaround and advanced exploration situations. Pala invests across all geographies and in all mining commodities as well as mining services and consumables. For more information, visit www.pala.com.
Certain statements in the press release are forward-looking statements and are prospective in nature, including statements with respect to Pala's future intentions regarding the securities of AMR that it owns. Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. These statements generally can be identified by the use of forward-looking words such as "may", "should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof or similar variations. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Such forward-looking statements should therefore be construed in light of such factors, and Pala is not under any obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.