Equity Capital Investment Recapitalizes the
Balance Sheet and Provides the Opportunity to Unlock Value of its
World-Class Hycroft Gold and Silver Deposit in Northern Nevada
WINNEMUCCA, Nev., March 15, 2022 /PRNewswire/ -- Hycroft Mining
Holding Corporation (Nasdaq: HYMC) ("Hycroft" or the "Company"), a
precious metals development company that owns the Hycroft Mine
located in the world-class mining region of Northern Nevada, today announced a
$56 million equity private placement
with precious metals investor Eric
Sprott and AMC Entertainment Holdings, Inc. (NYSE: AMC).
Diane Garrett, President,
CEO and Acting Chairman of Hycroft, commented, "We couldn't
be more pleased to announce this transformational investment in the
future of Hycroft, anchored by Eric
Sprott, one of the world's leading precious metals
investors, and AMC Entertainment Holdings, which has proven its
expertise and ability to address liquidity challenges and to raise
capital to optimize the value of significant underlying assets.
Collectively, their investment dramatically improves Hycroft's
liquidity position and provides years of financial runway.
Additionally, their confidence underscores the world-class nature
of Hycroft's gold and silver deposit and our potential to unlock
value at a pivotal moment in its development. We look forward to
working alongside our new investors to advance Hycroft up the value
chain."
Private Placement Terms
Mr. Sprott and AMC will
each invest $27.9 million in cash in
Hycroft in exchange for 23,408,240 units, with each unit consisting
of one common share of Hycroft and one common share purchase
warrant (the "Units"). The Units are priced at $1.193 per Unit, which is the minimum bid price
required by Nasdaq for an at-the-market purchase of a Unit. Each
purchase warrant will be exercisable for one common share of
Hycroft at a price of $1.068 per
share and will carry a five-year term from the date of issuance.
The closing of the Private Placement is expected to occur on or
about March 15, 2022.
With its investment, AMC has been granted the right to appoint a
representative to the Hycroft Board of Directors. After closing of
the Private Placement, Mr. Sprott and AMC will become the Company's
second largest stockholders, each holding approximately 21.8% of
the outstanding common shares of Hycroft.
Use of New Capital
Hycroft intends to use the
net proceeds from this private placement for general corporate
purposes, which may include the repayment, refinancing, redemption
or repurchase of existing indebtedness, working capital or capital
expenditures and other investments, advancement of the Initial
Assessment in the 2022 Technical Report Summary to a
pre-feasibility and/or feasibility study and additional exploration
at the Hycroft Mine.
Unlocking Additional Flexibility through Balance Sheet
Recapitalization
The Company also announced that it has
reached an agreement in principle with its primary lending partner,
Sprott Private Resource Lending II (Collector), LP ("Sprott"),
acting as Facility Agent, to extend all principal debt repayments
to one bullet payment in May
2027, from current maturity date of May 2025, subject to $50
million of new equity, and upon payment of a $3.3 million lender interest adjustment which
will be capitalized and added to the principal due upon
maturity. The extension of the maturity date from
May 2025 to May 2027 will be subject to certain loan coverage
conditions.
Hycroft has also reached an agreement with its second lien
holders whereby, subject to $50
million of new equity, they will extend the life of the loan
by two years to December 2027 with
continuing 10% annual payment-in-kind interest payments.
The Company will continue to consider and discuss its ability to
reduce its debt obligations with its current lenders.
About Hycroft Mining Holding Corporation
Hycroft is a U.S.-based, gold and silver development company that
owns the Hycroft Mine located in the world-class mining region of
Northern Nevada.
Cautionary Note Regarding Forward-Looking
Statements
This news release contains "forward-looking
statements" within the meaning of Section 27A of the United States
Securities Act of 1933, as amended, Section 21E of the Unites
States Securities Exchange Act of 1934, as amended, or the Unites
States Private Securities Litigation Reform Act of 1995. All
statements, other than statements of historical facts, included
herein and public statements by our officers or representatives,
that address activities, events or developments that our management
expects or anticipates will or may occur in the future, are
forward-looking statements, including but not limited to such
things as future business strategy, plans and goals, competitive
strengths and expansion and growth of our business. The words
"estimate", "plan", "anticipate", "expect", "intend", "believe"
"target", "budget", "may", "can", "will", "would", "could",
"should", "seeks", or "scheduled to" and similar words or
expressions, or negatives of these terms or other variations of
these terms or comparable language or any discussion of strategy or
intention identify forward-looking statements. Forward-looking
statements address activities, events or developments that the
Company expects or anticipates will or may occur in the future and
are based on current expectations and assumptions. These risks may
include the following and the occurrence of one or more of the
events or circumstances alone or in combination with other events
or circumstances, may have a material adverse effect on the
Company's business, cash flows, financial condition and results of
operations. Please see our "Risk Factors" set forth in our 8-Ks and
Annual Report on Form 10-K for the year ended December 31, 2020, as amended May 14, 2021, and other reports filed with the
SEC for more information about these and other risks. You are
cautioned against attributing undue certainty to forward-looking
statements. Although we have attempted to identify important
factors that could cause actual results to differ materially from
those described in forward-looking statements, there may be other
factors that cause results not to be as anticipated, estimated or
intended. Although these forward-looking statements were based on
assumptions that the Company believes are reasonable when made, you
are cautioned that forward-looking statements are not guarantees of
future performance and that actual results, performance or
achievements may differ materially from those made in or suggested
by the forward-looking statements contained in this news release.
In addition, even if our results, performance, or achievements are
consistent with the forward-looking statements contained in this
news release, those results, performance or achievements may not be
indicative of results, performance or achievements in subsequent
periods. Given these risks and uncertainties, you are cautioned not
to place undue reliance on these forward-looking statements. Any
forward-looking statements made in this news release speak only as
of the date of those statements, and we undertake no obligation to
update those statements or to publicly announce the results of any
revisions to any of those statements to reflect future events or
developments.
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SOURCE Hycroft Mining Holding Corporation