TIDMECR
ECR MINERALS plc
("ECR Minerals", "ECR" or the "Company")
AIM: ECR
US OTC: MTGDY
US$750,000 CONVERTIBLE LOAN
LONDON: 9 FEBRUARY 2015 - ECR Minerals plc is pleased to
announce the following with reference to the convertible loan
facility (the "Facility") in place with YA Global Master SPV Ltd
(the "Investor"), an investment fund managed by Yorkville Advisors
Global, LP (as previously announced on 3 September 2014).
The Company and the Investor have agreed to the drawdown by ECR
of three further loan tranches (each a "Tranche") under the
Facility, each Tranche being US$250,000 in principal amount for a
total of US$750,000. The aggregate net proceeds of the Tranches
will be US$690,683. The first of the Tranches (the "First Tranche")
has been drawn down. The second Tranche will be drawn down on or
about 2 March 2015 and the third will be drawn down on or about 1
April 2015. The principal terms of the Facility, which are
applicable to the Tranches, are described below.
ECR intends to deploy the net proceeds of the Tranches primarily
in connection with its gold exploration interests, namely the
Itogon gold project in the Philippines and the SLM gold project in
Argentina, as well as to support the other activities of the
Company, which include the evaluation of a number of potential new
investment opportunities.
Drilling at the Itogon gold project in the Philippines is
continuing in accordance with ECR's announcement dated 22 January
2015, and the Company expects to provide an update regarding
planned work at the SLM project in Argentina in the near future.
Images of the current drilling programme at Itogon may be viewed
at:
www.ecrminerals.com/Itogon-drilling-Jan2015
Stephen Clayson, Chief Executive Officer of ECR, commented:
"We are pleased to have secured this funding against a backdrop
of straitened financial circumstances for most junior mineral
companies. With the funding now in place we can proceed confidently
with drilling at the Itogon project, the results of which will we
hope demonstrate strong geological potential.
We are also continuing to closely review a small number of
potential new opportunities as part of a strategy to assemble a
carefully chosen, manageable portfolio of interests in high quality
mineral projects, our overriding objective being to secure a
prosperous future for ECR and its shareholders."
Principal Terms of the Facility
The outstanding principal amount of a loan tranche (a "Loan")
drawn down by ECR under the Facility is convertible at the
Investor's option into ordinary shares of the Company of 0.1p
("Ordinary Shares") on the following terms: (a) at 92.5% of the
average daily volume weighted average price (VWAP) of the Ordinary
Shares during the 10 trading days preceding the conversion date,
conversion on this basis being restricted (unless the Company
consents otherwise) to a maximum amount of US$250,000 per calendar
month (a limit which applies to all Loans outstanding under the
Facility collectively); or (b) at GBP0.002607 (0.2607p) in the case
of the First Tranche or, in relation to any subsequent Tranche or
any other subsequent Loan under the Facility, 150% of the average
daily VWAP of the Ordinary Shares during the five trading days
preceding drawdown of the relevant Loan, conversion on this basis
being subject to no maximum amount.
On maturity of a Loan, which shall be two years from the date of
drawdown (extendable by up to one year at the option of the
Investor) any outstanding principal amount will be mandatorily
converted to Ordinary Shares at the closing price of the Ordinary
Shares on or immediately prior to the maturity date.
Interest on the outstanding principal amount of a Loan will
accrue at 10% per annum, payable in Ordinary Shares at 92.5% of the
average daily VWAP of the Ordinary Shares during the 10 trading
days prior to the interest payment date. An implementation fee of
7.5% of the principal amount of each Loan is payable to the
Investor upon drawdown of the relevant Loan.
The Company is entitled to prepay a Loan in cash, in whole or in
part, by making a payment to the Investor equal to the principal
amount to be prepaid plus any interest due and an additional amount
of 10% of the principal amount to be prepaid. The Facility provides
for customary events of default, and following an event of default
the outstanding principal amount of a Loan plus interest may in
certain circumstances become immediately due and payable in cash.
If an event of default has been continuing for at least 30 calendar
days, the outstanding principal amount of a Loan may at the
Investor's option be converted in whole or in part to Ordinary
Shares at 80% of the VWAP of the Ordinary Shares for the five
trading days preceding the date of such a conversion. The drawdown
by the Company of the two further Tranches besides the First
Tranche is conditional, inter alia, on there being at the relevant
time no event of default which is continuing and on certain
warranties given by the Company to the Investor being true and
accurate by reference to the facts and circumstances then
existing.
In the event that the 30 day moving average closing price of the
Ordinary Shares falls below the nominal value of an Ordinary Share
for a period of five consecutive trading days, the outstanding
principal amount of a Loan shall become repayable in cash on a
monthly basis over the remaining term of the Loan, with interest
also payable in cash. If the closing price of the Ordinary Shares
were to subsequently cease to be less than the nominal value of an
Ordinary Share for a period of 10 consecutive trading days, the
monthly cash repayments would no longer be required and the Loan
would revert to being convertible into Ordinary Shares on the prior
terms.
With respect to the First Tranche, the Investor has received
21,740,000 warrants, each exercisable to acquire one Ordinary Share
for a price of GBP0.002344 (0.2344p) and valid for three years. In
connection with the two further Tranches and with any other
subsequent Loan, the Investor will receive a quantity of warrants
equal to 25% of the principal amount of such Loan (converted to
GBP) divided by the closing price of the Ordinary Shares on the
trading day prior to the date of drawdown, each warrant to be valid
for three years and exercisable to acquire one Ordinary Share for a
price equal to 125% of the VWAP of the Ordinary Shares on the
trading day prior to the date of drawdown.
The Investor and its affiliates, associates, partners and
insiders are prohibited under the terms of the Facility from
holding a net short position in respect of Ordinary Shares at any
time, and from assisting or enabling any other person to do so
(including by lending Ordinary Shares).
The Facility is available to the Company for three years from 2
September 2014 and provides a framework for the drawdown by ECR of
Loans up to US$10 million in aggregate principal amount. ECR
received a Loan under the Facility of US$1.5 million in principal
amount in September 2014, of which US$885,712 (plus accrued
interest) remains outstanding.
The drawdown of any further Loans besides the Tranches which are
the subject of this announcement is by agreement between the
Company and the Investor. Neither party is under any obligation to
agree to any further Loan.
ABOUT ECR
ECR is a mineral exploration and development company with, among
other interests, the right to earn a 50% interest in the Itogon
gold project in the Philippines. Itogon is an advanced exploration
project located in a gold and copper mining district in the north
of the Philippines.
ECR has a 100% interest in the SLM gold project in La Rioja
Province, Argentina, the exploration strategy for which is to
delineate multiple medium to high grade, low tonnage deposits
suitable for advancement to production on a relatively low capital,
near term basis.
ECR continues to review potential new investments on a highly
selective basis, with a concentration on precious, base and
strategic metals projects in Asia and South America.
FOR FURTHER INFORMATION PLEASE CONTACT:
ECR Minerals plc Tel: +44 (0)20 7929 1010
Paul Johnson, Non-Executive Chairman
Stephen Clayson, Director & CEO
Richard (Dick) Watts, Technical Director
Email: info@ecrminerals.com
Website: www.ecrminerals.com
Cairn Financial Advisers LLP Tel: +44 (0)207 148 7900
Nominated Adviser
Emma Earl/Jo Turner
Daniel Stewart & Company plc Tel: +44 (0)20 7776 6550
Broker
Colin Rowbury
FORWARD LOOKING STATEMENTS
This announcement may include forward looking statements. Such
statements may be subject to a number of known and unknown risks,
uncertainties and other factors that could cause actual results or
events to differ materially from current expectations. There can be
no assurance that such statements will prove to be accurate and
therefore 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. Any
forward looking statements contained herein speak only as of the
date hereof (unless stated otherwise) and, except as may be
required by applicable laws or regulations (including the AIM Rules
for Companies), the Company disclaims any obligation to update or
modify such forward looking statements as a result of new
information, future events or for any other reason.
This information is provided by Business Wire
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