Nevada Copper Corp. (TSX: NCU) (“
Nevada
Copper” or the “
Company”) is pleased to
announce that it has entered into an agreement with Scotiabank, on
behalf of a syndicate of underwriters (collectively, the
“
Underwriters”), pursuant to which the
Underwriters have agreed to buy on a bought deal basis 130,400,000
units of the Company (the “
Units”) at a price of
$0.165 per Unit (the “
Offering Price”) for aggregate
gross proceeds of approximately $21.5 million (the
“
Offering”).
Mike Ciricillo, CEO of Nevada Copper commented
“This offering together with the recently completed upsize of our
credit facility with KfW IPEX-Bank will strengthen the Company’s
balance sheet as it proceeds to complete its ramp-up of the Pumpkin
Hollow Underground Project.”
Each Unit will consist of one common share of
the Company (each a “Common Share”) and one-half
of one common share purchase warrant (each full warrant, a
“Warrant” and collectively the
“Warrants”). Each Warrant will be exercisable for
one Common Share (each a “Warrant Share”) at a
price of $0.22 per Warrant Share at any time for a period of 18
months following closing of the Offering.
The Company has granted the Underwriters an
option, exercisable in whole or in part, at the sole discretion of
the Underwriters, at any time for a period of 30 days from and
including the closing of the Offering, to purchase from the Company
up to an additional 15% of the Units sold under the Offering, on
the same terms and conditions of the Offering to cover
over-allotments, if any, and for market stabilization purposes (the
“Over-Allotment Option”). The Over-Allotment
Option may be exercised by the Underwriters to purchase additional
Units, Common Shares, Warrants or any combination thereof. In the
event the Over-Allotment Option is exercised in full, the aggregate
gross proceeds of the Offering to the Company will be approximately
$24.7 million.
The Units will be offered by way of a short form
prospectus to be filed in all provinces of Canada, except Quebec.
The Offering is expected to close on or about January 29, 2021,
subject to the receipt of all necessary regulatory and stock
exchange approvals, including the approval of the Toronto Stock
Exchange and applicable securities regulatory authorities.
The Company intends to use the net proceeds of
the Offering to:
- repay approximately US$15.6 million
of outstanding indebtedness which had been advanced by Pala
Investments Limited (“Pala”), the Company’s
largest shareholder, to the Company in November and December to
fund its operations prior to and as a condition of the receipt by
the Company of US$15 million of additional funds under its upsized
senior credit facility with KfW IPEX-Bank; US$15 million will be
available to be newly drawn by the Company under the terms of a
credit facility to be entered into concurrently with closing of the
Offering to fund the construction and ramp-up of the Company’s
Pumpkin Hollow Underground Project and for the general working
capital needs of the Company; and
- fund general corporate purposes,
including working capital.
Additionally, Pala has agreed to subscribe for
approximately $11 million Units on a private placement basis at the
Offering Price (the “Concurrent Private
Placement”) with such subscription to be satisfied by Pala
tendering certain outstanding indebtedness owed by the Company to
Pala in the amount of approximately $11 million. Such indebtedness
was advanced by Pala to the Company in October to fund its
operations in advance of a longer-term financing solution becoming
available. The Concurrent Private Placement will close concurrently
with the Offering.
This news release does not constitute an offer
to sell or a solicitation of an offer to sell any of securities in
the United States. The securities have not been and will not be
registered under the U.S. Securities Act or any state securities
laws and may not be offered or sold within the United States or to
U.S. Persons unless registered under the U.S. Securities Act and
applicable state securities laws or an exemption from such
registration is available.
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 substantial reserves and resources
including copper, gold and silver. Its two fully permitted projects
include the high-grade underground mine and processing facility,
which is now in the production stage, and a large-scale open pit
project, which is advancing towards feasibility status.
NEVADA COPPER
CORP.www.nevadacopper.com
Mike Ciricillo, President and
CEO
For further information
contact:Rich Matthews, Investor RelationsIntegrous
Communicationsrmatthews@integcom.us+1 604 757 7179
Cautionary Language
This news release includes certain statements
and information that constitute forward-looking information within
the meaning of applicable Canadian securities laws. All statements
in this news release, other than statements of historical facts are
forward-looking statements. Such forward-looking statements and
forward-looking information specifically include, but are not
limited to, statements that relate to the completion of the
Offering, the Concurrent Private Placement, the entering into of a
credit facility with Pala and the timing in respect of each thereof
and the use of proceeds of the Offering and the Concurrent Private
Placement. There can be no assurance that the Offering or the
Concurrent Private Placement will be completed.
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”, “scheduled”,
“estimates”, “forecasts”, “intends”, “anticipates”, or “believes”
or the negatives thereof or variations of such words and phrases or
statements that certain actions, events or results “may”, “could”,
“would”, “might” or “will” be taken, occur or be achieved.
Forward-looking statements or information are subject to known or
unknown risks, uncertainties and other factors which may cause the
actual results and events to be materially different from any
future results, performance or achievements expressed or implied by
such forward-looking statements or information.
Forward-looking statements or information are
subject to a variety of risks and uncertainties which could cause
actual events or results to differ from those reflected in the
forward-looking statements or information, including, without
limitation, risks and uncertainties relating to: the ability of the
Company to complete the ramp-up of the Pumpkin Hollow Underground
Project within the expected cost estimates and timeframe; the state
of financial markets; the impact of COVID-19 on the business and
operations of the Company; history of losses; requirements for
additional capital and no assurance can be given regarding the
availability thereof; dilution; adverse events relating to milling
operations, construction, development and ramp-up, including the
ability of the Company to address underground development and
process plant issues; ground conditions; cost overruns relating to
development, construction and ramp-up of the Pumpkin Hollow
Underground Project; loss of material properties; interest rates
increase; global economy; limited history of production; future
metals price fluctuations; speculative nature of exploration
activities; periodic interruptions to exploration, development and
mining activities; environmental hazards and liability; industrial
accidents; failure of processing and mining equipment to perform as
expected; labor disputes; supply problems; uncertainty of
production and cost estimates; the interpretation of drill results
and the estimation of mineral resources and reserves; changes in
project parameters as plans continue to be refined; possible
variations in ore reserves, grade of mineralization or recovery
rates from management’s expectations and the difference may be
material; legal and regulatory proceedings and community actions;
the outcome of disputes with the Company’s contractors; accidents;
title matters; regulatory approvals and restrictions; increased
costs and physical risks relating to climate change, including
extreme weather events, and new or revised regulations relating to
climate change; permitting and licensing; volatility of the market
price of the Company’s common shares; insurance; competition;
hedging activities; currency fluctuations; loss of key employees;
other risks of the mining industry as well as those risks discussed
in the Company’s Management’s Discussion and Analysis in respect of
the year ended December 31, 2019 and in the section entitled “Risk
Factors” in the Company’s Annual Information Form dated May 15,
2020. Should one or more of these risks and uncertainties
materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in
forward-looking statements or information. The forward-looking
information and statements are stated as of the date hereof. The
Company disclaims any intent or obligation to update
forward-looking statements or information except as required by
law.
The Company 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. Accordingly,
readers should not place undue reliance on forward-looking
statements and information.
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