Nautilus Minerals Inc. (TSX:NUS) (OTC:NUSMF)
(Nasdaq Intl Designation) (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.
To date the Company has received bridge loans
from the Lender totaling US$6,650,000. In conjunction with the most
recent advance of US$1,900,000, the Company has issued to the
Lender an additional 8,161,512 warrants of the Company (the
"Warrants"), for a total of 28,565,291 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 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 is
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/1961_0/Nautilusreceivesadditionalbridgeloans
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 RelationsNautilus Minerals Inc.
(Toronto)Email: investor@nautilusminerals.comTel: +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;
that the Company will be unable to rectify or arrange for the
rectification of the default under the shipbuilding contract for
the construction of the Production Support Vehicle (as announced on
11 December 2017); and that agreements with third party contractors
for building slots within certain timeframes are not secured as
required. As the Company has not completed a prefeasibility study
or feasibility 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).