CALGARY, ALBERTA--(Marketwire - Oct. 10, 2012) - West Mountain Capital Corp. ("the Company") (TSX VENTURE:WMT) today announces that it has executed a Commitment Letter with HSBC Bank Canada ("HSBC") for $3.5 million in debt financing. The proceeds from this financing will be used for the build-out of the Company's recently announced contracts and joint venture operations in China.
The Company, through its 100% owned subsidiary Phase Separation Solutions Inc. ("PS2"), has three major projects underway in China, specifically a 33,000 tonne pesticide contaminated soil project in Hangzhou, Zhejiang province, a joint-venture in Zhoushan, Zhejiang province to establish a facility to recover oil from oily sludge, and a 10-year subcontract agreement in principal to treat hazardous industrial sludge in Changqing, Shandong province.
Under the terms of the financing the credit will be provided as four separate facilities; firstly, a $500,000 demand revolving loan to assist in the Company's day-to-day operations in Canada; secondly, a $1.0 million demand revolving line to purchase foreign forward exchange contracts to hedge against exchange fluctuations in connection with export sales; thirdly, a $500,000 demand revolving loan to assist with the Company's day-to-day operations in China; and a capital loan of $1.5 million to finance the acquisition of capital assets, equipment and miscellaneous expenses related to the operations in China.
Security for the debt facilities is a first charge on the Company's real property in Wolseley, Saskatchewan. In addition, the HSBC credit facilities will be guaranteed 100% by the Export Development Corporation ("EDC"), Government of Canada.
"We appreciate the confidence and support offered by HSBC and the EDC as we continue with our build-out in China. With this financing we will be able to complete our technology installations and begin generating revenue," said Paul Antle, President and CEO.
The debt financing from HSBC is considered bridge financing and is repayable within 18 months. The debt financing is subject to the satisfaction of customary conditions precedent including the finalization and execution of formal loan and security documentation and will replace the Company's existing credit facility.
About Phase Separation Solutions:
PS2 is an established Canadian environmental solutions company specializing in the thermal treatment of a variety of hazardous and non-hazardous waste streams. It employs a unique indirectly heated, closed loop technology that allows it to extract even the most hazardous contaminants from soil, industrial sludge and waste converting much of it into reusable oil and synthetic natural gas that it uses to sustain the process. This methodology offers significant opportunity for greenhouse gas reduction over traditional hazardous waste destruction technologies. PS2's management team maintains expertise in hazardous waste management and contaminated site remediation with experience spanning North America and internationally throughout 14 countries.
This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this news release contains forward-looking statements with respect to a new debt credit facility. The forward-looking statements and information are based on certain key expectations and assumptions made by West Mountain, including expectations and assumptions concerning the plan to be awarded contracts to treat waste material. Although West Mountain believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward looking statements and information because West Mountain can give no assurance that they will prove to be correct.
Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the treatment of pesticide contaminated soil, oily sludge and hazardous industrial sludge in general, attempting to secure work, the uncertainty of estimates and projections relating to the value of the contract, health, safety and environmental risks, transportation costs, environmental risks, failure to realize the anticipated benefits of the contract, failure to obtain required regulatory and other approvals, and changes in legislation, including but not limited to environmental regulations, and risks associated with doing business in China. Readers are cautioned that the foregoing list of factors is not exhaustive. The forward-looking statements and information contained in this news release are made as of the date hereof and West Mountain undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts the responsibility for the adequacy or accuracy of this release.