VANE Minerals (LON:VML) has renegotiated the terms of two outstanding convertible loan notes to limit possible dilution to other shareholders.
VANE will now repay a £500,000 note held by City Natural Resources High Yield Trust this month rather than September, while repayment of a £1 million note held by Geiger Counter Ltd has been extended until 2017.
Both City Natural Resources and Geiger Counter are funds managed by New City Investment Managers.
Geiger Counter’s loan note will now be convertible into 80 million VANE ordinary at 1.25p, a 34 per cent premium to yesterday’s close. Shareholders have to approve the new loan note, which will pay interest at 8 per cent.
David Newton, VANE’s chief executive, said he was delighted with the new agreement.
“The maximum dilution to existing shareholders would equate to only 15.3% of the enlarged share capital of the Company and the agreement allows the company to continue to devote its current cash resources to the development of its highly promising copper and uranium exploration assets."
VANE announced last year it had found a copper-molybdenum porphyry system on its acreage in New Mexico, an area that has produced huge amounts of the metals in the past.
The company also has gold and silver mining operations in Mexico that are providing the cash to fund its copper exploration.
VANE had cash balances of £2.30 million at the end of December.