TIDMWLFE
RNS Number : 3200G
Wolf Minerals Limited
01 March 2018
1 March 2018
Wolf Minerals Limited
Senior Debt Restructure and Additional GBP10 Million Funding
Specialty metals producer, Wolf Minerals (ASX: WLF, AIM: WLFE)
(Wolf or the Company) is pleased to provide an update on the
Company's financing arrangements to support short term working
capital and complete the operational ramp up at the Drakelands open
pit mine (Drakelands).
Highlights
ü Existing Bridge Facility increased from GBP55 million to GBP65
million.
ü Standstill period extended with limited events of default.
ü Senior Debt principal repayments reduced for the next three
quarters.
ü Financing arrangements to support Wolf in achieving long term
self-sustaining cash flows.
The encouraging improvements in the operating performance at
Drakelands have enabled Wolf to work with its key project
stakeholders to develop financing arrangements that can support the
Company in achieving long term self-sustaining cash flows. As a
result, Wolf has executed binding agreements with:
-- Its existing senior lenders (Senior Lenders) for an extension
to the standstill period and further restructure of the senior debt
currently outstanding (Senior Debt Restructure);
-- Resource Capital Fund VI L.P. (RCF VI) to provide an
additional GBP10 million, secured subordinated loan under the
existing bridge loan facility (Bridge Facility), with the potential
for this to be increased to GBP15 million at the discretion of RCF
VI; and
-- Its existing offtakers, Global Tungsten & Powders Corp
(GTP) and Wolfram Bergbau und Hütten AG (WBH), to align with the
extended standstill period.
Commenting on the financing arrangements, Wolf's interim
Managing Director, Richard Lucas said:
"We anticipate 2018 being a transformative year for Wolf, where
it reaches design performance and pursues further opportunities to
build shareholder value. These financing arrangements provide a
platform to achieve those goals. The operational ramp up at
Drakelands is progressing towards completion and, with strong
tungsten market conditions, should deliver long term
self-sustaining cash flows.
We recognise the significant contribution from each of our key
project stakeholders to date in supporting these achievements and
sharing Wolf's vision of a world class tungsten and tin operation
in the UK."
Bridge Facility
The additional funding under the Bridge Facility is being
provided on the same terms as the subordinated loan announced on 27
October 2017, including that it will be fully secured.
The Bridge Facility (and hence the subordinated loan and
convertible loan) matures in October 2020 when they are repayable
in full. Under the Bridge Facility the Company has also given RCF
VI certain warranties and indemnities and RCF VI has certain
limited rights of termination.
Terms of the subordinated loan
The subordinated loan interest rate of 15% p.a. is payable
quarterly in arrears in either cash or shares at the Company's
choice, (assuming the required shareholder consents are obtained to
issue sufficient new shares) issued at the prevailing 20 day volume
weighted price per Wolf share.
Terms of the convertible loan
The convertible loan interest rate of 10% p.a. is payable
quarterly in arrears in either cash or shares at the Company's
choice, issued at the prevailing 20 day volume weighted average
price per Wolf share.
Following completion of certain conditions precedent, the
Company anticipates receiving the additional GBP10 million of
funding in two tranches of GBP5 million, with the first tranche
being received by the end of February and the second tranche in
April 2018. The potential further GBP5 million (taking the Bridge
Facility increase to GBP15 million) will be advanced at the
discretion of RCF VI.
Pursuant to its terms, the Bridge Facility mandatorily switched
to a subordinated loan on 21 October 2017 and the new funds shall
therefore be provided in the form of an additional subordinated
loan.
If certain conditions precedent are satisfied (including
shareholder approval and RCF VI obtaining FIRB approval), RCF VI
can elect that the subordinated loans switch to subordinated
convertible notes. The Company will, in due course, seek
shareholder approval to enable the entire Bridge Facility to switch
to convertible notes.
The additional funding will increase the subordinated loan
announced on 27 October 2017 to a total of GBP20 million (and the
potential to increase to a total of GBP25 million at the discretion
of RCF VI). If converted to the convertible loan, it will have a
minimum conversion price of the lesser of A$0.055 per share and the
price of any subsequent equity issued as part of any broader
recapitalisation transaction. The minimum conversion price of the
original subordinated loan of GBP45 million provided under the
Bridge Facility was set at the lesser of A$0.09 per share and the
price of any subsequent equity issued as part of any broader
recapitalisation transaction.
The Company shall pay to RCF VI a facility fee of 2% which may
be capitalised at RCF VI's election. All other terms of the Bridge
Facility, the subordinated loans and the potential subordinated
convertible notes are as described in the Company's announcements
of 24 October 2016, 28 June 2017 and 27 October 2017.
Debt Restructure
The Company currently has GBP64 million outstanding under its
debt facilities with the Senior Lenders (Senior Debt).
As announced on 30 January 2018, the Company's funding and
offtake standstill arrangements from the debt restructure in
October 2016 are due to end on 28 February 2018 and revert to the
original terms as announced on 24 October 2016. This includes the
re-commencement of principal debt repayments, with a repayment of
GBP1 million due on 28 February 2018.
As part of funding negotiations, the Senior Lenders and RCF VI
have agreed to extend the standstill period of certain loan
agreement conditions until 31 January 2019. The standstill provides
that a limited number of events of default shall apply under the
Senior Debt and Bridge Facility and grants relief from financial
and other covenants. Further, relief has been provided for
financial ratios to be disapplied until 30 September 2019.
The terms of the Senior Debt Restructure provide that the Senior
Debt principal repayments will be reduced to GBP1 million per
quarter due on 30 April 2018, 31 July 2018 and 31 October 2018
before reverting to the current principal repayment schedule from
31 January 2019. The total deferred amount of GBP3.3 million has
been added to the principal repayments due in 2020. In addition,
the current principal repayment schedule is to be reviewed by 31
July 2019, with a view to Wolf and the Senior Lenders agreeing a
resculpted repayment schedule within the existing June 2023 tenor
of the Senior Debt.
A portion of the Company's Senior Debt is supported by
guarantees provided by the German government's Untied Loan
Guarantee Scheme (Ungebundene Finanzkreditdeckung - UFK), and
Wolf's tungsten concentrate customers GTP and WBH (together
Guarantors). The Guarantors have consented to the Senior Debt
Restructure.
In addition, the Company's supply agreements with GTP and WBH
have been amended to align with the extended standstill period
under the Senior Debt and Bridge Facility.
Related Party Transaction
RCF VI is deemed to be a Related Party as defined in the AIM
Rules as it is considered to be an associate of Resource Capital
Fund V L.P. (RCF V) and RCF V Annex Fund (Annex Fund). RCF V, Annex
Fund and RCF VI currently hold in aggregate 609,704,057 shares,
which equates to a relevant interest of approximately 56.0%(1) . As
a result, entering into the amended Bridge Facility is deemed to be
a related party transaction under the AIM Rules.
The Company's Board of Directors (excluding Mr Chris Corbett,
who is an employee of an entity which is an associate of RCF VI and
RCF V) consider, having consulted with the Company's nominated
adviser, that the terms of the transaction are fair and reasonable
insofar as its shareholders are concerned.
ENDS
For further details, please contact:
Numis Securities: John Prior/James Black/Paul Gillam +44(0) 20
7260 1000
Newgate: Adam Lloyd / Ed Treadwell +44 (0) 20 7653 9850
Wolf Minerals Limited: Richard Lucas + 44 (0) 17 5239 3235
About Wolf Minerals
Wolf Minerals is a dual listed (ASX: WLF, AIM: WLFE) specialty
metals producer. In 2015, Wolf Minerals completed the development
of a large tungsten resource at its Drakelands Mine, located at
Hemerdon, in southwest England.
(1) Total Fully Paid Outstanding Shares 1,088,696,830 as per
Appendix 3B, 27 December 2017
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCDDGDDLDDBGII
(END) Dow Jones Newswires
March 01, 2018 02:02 ET (07:02 GMT)
Wolf Minerals (LSE:WLFE)
Historical Stock Chart
From Apr 2024 to May 2024
Wolf Minerals (LSE:WLFE)
Historical Stock Chart
From May 2023 to May 2024