Minto Metals has announced three transactions to improve its liquidity: a drawdown and extension under the Sumitomo prepayment facility, an amendment to its share purchase agreement, and a new term loan facility.
The company said in a statement that it has drawn down a further US$1.5 million under its existing prepayment facility with Sumitomo Canada Limited bringing the total funds advanced under the facility to US$12.5 million.
Per the agreement, Sumitomo established a secured prepayment non-revolving credit facility in Minto’s favor in the amount of $US17.5 million.
The facility is repayable over 48 months and is in connection with the offtake agreement between the two parties under which Sumitomo agreed to purchase 100% of the copper concentrate produced at the Minto Mine for four years, based on 50,000 dry metric tonnes of concentrate production per year.
With the additional US$1.5 million drawdown, Minto said the parties have agreed to extend the offtake agreement for an additional 12 months or until a further 40,000 dry metric tones of copper concentrate are produced.
The company intends to use the proceeds of the drawdown for general corporate purposes.
Additionally, Minto said the company, Pembroke Resources plc, and Capstone Mining Corp (TSX:CS) have agreed to amend and extend the share purchase agreement payment of deferred purchase price obligations.
Under the revised schedule, the $5 million owing to Capstone will be payable as $250,000 on each September 1, 2023, December 1, 2023, March 1, 2024, and June 3, 2024, and $1 million on each September 3, 2024, December 3, 2024, March 3, 2025, and June 3, 2025.
Minto said it has agreed to assume all of Pembridge’s obligations under the share purchase agreement, and Capstone has released Pembridge from all such obligations.
Finally, the company announced that it has entered into a new loan agreement with Lion Point Capital LP, Copper Holdings LLC, and GLAS Americas LLC, as agents for the lenders, for a secured non-revolving term facility of C$1 million.
The facility may be increased to C$2 million, subject to conditions, and bears interest at a rate of 10% per annum, payable semi-annually.
The facility is due to be repaid on the earlier of April 14, 2026, or the final repayment date under the company’s previously issued secured notes dated June 3, 2019, held by Cedro Holdings I LLC and Stiftelsen Lejonudden.
Minto Metals operates the producing Minto mine located within the traditional territory of the Selkirk First Nation in the Minto Copper Belt of the Yukon.
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