McEwen Mining Amends Term Loan Facility and Raises Additional $15 Million from Rob McEwen
April 05 2022 - 6:28PM
McEwen Mining Inc. (NYSE: MUX) (TSX: MUX)(“McEwen”
or the “Company”) is pleased to announce that it has amended its
$50 million senior secured term loan facility (the “Term Loan”) to
gain financial flexibility and entered into a new $15 million
unsecured subordinated promissory note (the “Promissory Note”).
“Reduced cash flow from operations in Q1
has placed McEwen Mining in a challenging position which we needed
to overcome. I have invested a further $15 million by way of an
unsecured Promissory Note so that we can implement corrective
action. It was also beneficial to extend the maturity of our Term
Loan to enable us to invest in production growth and mine life
extensions before debt retirement. Results from operations are
expected to improve starting with the current quarter and resume
the positive trend we experienced during 2021. Gold Bar achieved
our production target in Q1 and Los Azules has made some important
advances,” said Rob McEwen, Chairman and Chief
Owner. “The deviation from our financial forecast for Q1
was caused by lower production at the Fox Complex and at San José.
Loss of manpower due to COVID-19 was a significant factor at both
mines. Very cold weather and equipment failures also occurred at
the Fox mill.”
The maturity of the Term Loan was extended to
March 31, 2025, the amortization period and certain covenants were
also amended, and any security interest over McEwen Copper Inc. and
the Los Azules copper project was removed. The principal amount of
the loan and reference rate remain unchanged. The amendment will
eliminate the need to repay $10 million of principal in 2022 and
$40 million in 2023 and allow McEwen Copper to raise additional
financing as well as pursue its IPO.
In consideration for the extension of the Term
Loan and other amendments, Sprott Private Resource Lending II
(Collector), LP will be paid bonus interest in the form of 588,235
restricted common shares of the Company. Evanachan Limited, an
entity wholly-owned by Rob McEwen, and a lender of half the
principal outstanding under the Term Loan, has waived any right to
receive bonus interest.
In addition, the Company has entered into a $15
million Promissory Note with Evanachan Limited maturing on
September 30, 2025, and bearing interest of 8% payable monthly in
arrears. The Promissory Note will be used for working capital
purposes and can be repaid by the Company at any time without
penalty.
CAUTION CONCERNING FORWARD-LOOKING
STATEMENTSThis news release contains certain
forward-looking statements and information, including
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. The forward-looking
statements and information expressed, as at the date of this news
release, McEwen Mining Inc.'s (the "Company") estimates, forecasts,
projections, expectations or beliefs as to future events and
results. Forward-looking statements and information are necessarily
based upon a number of estimates and assumptions that, while
considered reasonable by management, are inherently subject to
significant business, economic and competitive uncertainties, risks
and contingencies, and there can be no assurance that such
statements and information will prove to be accurate. Therefore,
actual results and future events could differ materially from those
anticipated in such statements and information. Risks and
uncertainties that could cause results or future events to differ
materially from current expectations expressed or implied by the
forward-looking statements and information include, but are not
limited to, effects of the COVID-19 pandemic, fluctuations in the
market price of precious metals, mining industry risks, political,
economic, social and security risks associated with foreign
operations, the ability of the corporation to receive or receive in
a timely manner permits or other approvals required in connection
with operations, risks associated with the construction of mining
operations and commencement of production and the projected costs
thereof, risks related to litigation, the state of the capital
markets, environmental risks and hazards, uncertainty as to the
calculation of mineral resources and reserves, and other risks.
Readers should not place undue reliance on forward-looking
statements or information included herein, which speak only as of
the date hereof. The Company undertakes no obligation to reissue or
update forward-looking statements or information as a result of new
information or events after the date hereof except as may be
required by law. See McEwen Mining's Annual Report on Form 10-K for
the fiscal year ended December 31, 2021, and other filings with the
Securities and Exchange Commission, under the caption "Risk
Factors", for additional information on risks, uncertainties and
other factors relating to the forward-looking statements and
information regarding the Company. All forward-looking statements
and information made in this news release are qualified by this
cautionary statement.
The NYSE and TSX have not reviewed and do not
accept responsibility for the adequacy or accuracy of the contents
of this news release, which has been prepared by the management of
McEwen Mining Inc.
ABOUT MCEWEN MININGMcEwen
Mining is a diversified gold and silver producer and explorer
focused in the Americas with operating mines in Nevada, Canada, and
Argentina. It also has a large exposure to copper through its
subsidiary McEwen Copper, owner of the Los Azules copper deposit in
Argentina.
CONTACT
INFORMATION: |
Investor Relations:(866)-441-0690
Toll-Free(647)-258-0395Mihaela Iancu ext.
320info@mcewenmining.com |
Website: www.mcewenmining.comFacebook: facebook.com/mcewenminingFacebook: facebook.com/mcewenrobTwitter: twitter.com/mcewenminingTwitter: twitter.com/robmcewenmuxInstagram: instagram.com/mcewenmining |
150 King Street WestSuite 2800, P.O. Box 24Toronto, ON, CanadaM5H
1J9 |
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