Mineral & Financial Invest. Limited Investment Update: Ascendant Resources (5792T)
November 15 2023 - 6:06AM
UK Regulatory
TIDMMAFL
RNS Number : 5792T
Mineral & Financial Invest. Limited
15 November 2023
MINERAL AND FINANCIAL INVESTMENTS LIMITED
Investment Update: Ascendant Resources Announces an Additional
US$4.0M of Funding for the Lagoa Salgada VMS Project in
Portugal
HIGHLIGHTS :
-- Ascendant finalizing amendment of existing Stream Agreement
with Sprott Streaming for an additional US$4M
-- Ascendant progressing funding to further Optimize Development of Lagoa Salgada
-- Ascendant's focus is currently on Improved Metallurgical
Recoveries, Concentrate Qualities and Optimized Mine Plan and Plant
Sizing
-- Extension granted to M&F on its Put option and for EDM on its Option on Lagoa Salgada
Camana Bay, Cayman Islands - 15 November 2023 - Mineral and
Financial Investments Limited (LSE-AIM: MAFL) ("M&F" "MAFL" or
the "Company") is pleased to provide an update of its investments
in Redcorp Empreedimentos Mineros Lda ("Redcorp") and Ascendant
Resources Inc. ("Ascendant") which are developing the Lagoa Salgada
Polymetallic Project in Portugal. The Project is being funded and
led by Ascendant. M&F owns a conditional 20% Carried Interest
in Redcorp and Ascendant owns the balance (please see the
announcement dated 28 November 2022 for further details ).
Stream Agreement
Ascendant has announced that it is finalizing an amendment to
the existing metals purchase and sale agreement (the "Agreement")
with Sprott Resource and Streaming Royalty Corp. ("Sprott
Streaming"), including an increased deposit of US$4 million against
future production at its Lagoa Salgada VMS project ("Lagoa Salgada"
or the "Project") in Portugal. The Agreement is being amended to
increase the stream percentage to 2.75% of gross metals from 1.75%.
To facilitate funding in advance of commercial production, the
parties intend to amend the existing 10% secured note from US$15
million to US$19 million.
The amendments are expected to be completed and funded on or
about 29 November 2023, although there is no assurance that the
transactions will close, and the amendments are not legally binding
until such time as definitive agreements are executed.
Proceeds will fund development works including metallurgical
work aimed to further enhance both recoveries and concentrate
qualities at Lagoa Salgada as well as optimizing the mine plan,
production scheduling and plant size which are expected to improve
Project Economics.
Extension of EDM's Option
Additionally, following a request by Empresa de Desenvolvimento
Mineiro S.A. ("EDM"), the Portuguese State Mining Development
Agency, for a 60-day extension to its existing option to
participate in or sell up to a 15% interest in the Project by
making its election by 3 February 2024 (previously 2 December
2023), Ascendant and the Company have agreed consequential
amendments to the terms of their respective call and put
options.
Under the amendments, EDM shall have the right and option, but
not the obligation to participate in or sell up to a 15% interest
in the Project by making its election to do so by 3 February 2024
(the previous agreement stated that this election need to be made
by 2 December 2023) (the "Election"). Thereafter, in accordance
with its existing terms, if EDM elects to exercise its option, then
Ascendant is entitled to exercise its call option causing the
transfer of a relevant portion of shares that M&F hold in
Redcorp, to Ascendant such that Ascendant will continue to own an
80% interest in the Project. If EDM's elects not to participate
then M&F's 20% Carried Interest ("CI") remain in place. If
EDM's exercises its option and receives a 15% Working Interest,
then M&F's interest is diluted to a 5% Carried Interest
Extension of M&F's Put Option
The amendments also change the timeframe of M&F's right, but
not the obligation, to exercise its put option. This right to Put
its interest to Ascendant now commences on the date on which EDM
makes the Election and terminates four (4) months thereafter (the
previous time frame was that M&FI's right commenced of the date
the Definitive Feasibility Study on the Project was produced, and
expired six months +10 days thereafter). If exercised the right
requires Ascendant to purchase all of the Redcorp shares then held
by M&FI, representing a 5% CI in Redcorp by paying the put
price to M&FI. The put price would be an amount in US dollars,
payable in cash, equal to 5% of the post-tax net present value of
the Project provided in the then current feasibility study using a
10.5% discount rate (the "Put Option"). More details of this are
set out in the announcement dated November 28, 2022.
FOR MORE INFORMATION:
Jacques Vaillancourt, Mineral & Financial Investments Ltd. +44 780 226 8247
Katy Mitchell and Sarah Mather, WH Ireland Limited +44 207 220 1666
Jon Belliss, Novum Securities Limited +44 207 382 8300
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 (MAR) as in force in
the United Kingdom pursuant to the European Union (Withdrawal) Act
2018. Upon the publication of this announcement via Regulatory
Information Service (RIS), this inside information is now
considered to be in the public domain.
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