Los Andes Copper Ltd (CVE:LA) (OTCMKTS:LSANF) (FRA:L41A) will receive a US$5 million investment from Queen's Road Capital Investment Ltd (CVE:QRC) via a convertible debenture.
The proceeds will be allocated towards the completion of the Vizcachitas project’s pre-feasibility study, according to a statement.
Los Andes Copper owns 100% of the Vizcachitas project, one of the largest advanced copper deposits in the Americas, which will become Chile’s next major copper mine.
READ: Los Andes Copper receives environmental approval for drilling, allowing it to complete PFS at Chile copper project
The company said the convertible debenture will have a five-year term, carry an 8% coupon, and will be convertible into common shares in the capital of the company at C$10.82 each. The interest is payable quarterly, 5% in cash and 3% in shares, at the 20-day volume-weighted average price prior to the interest payment date.
The financing is subject to the satisfaction of customary closing conditions, including but not limited to TSX Venture Exchange and other regulatory approvals and the completion of due diligence and definitive documentation. The investment is expected to occur in May.
Board appointment
In conjunction with the investment, Los Andes Copper said that the chairman and CEO of Queen's Road Capital, Warren Gilman, has agreed to be nominated for appointment to the board of directors of the company at its upcoming shareholder meeting.
"We are pleased to have entered into this investment agreement with Queen's Road Capital, and Los Andes is the company's first investment in the copper sector, highlighting the high quality nature of the Vizcachitas Project,” said Fernando Porcile, executive chairman of Los Andes.
"This investment follows the receipt of unanimous approval for drilling to be carried out at the Vizcachitas Project, which is required to complete the ongoing Pre-Feasibility Study, and I look forward to keeping the market updated with our progress."
Gilman added: "Queen's Road Capital is happy that its first investment in the copper sector is in Los Andes Copper. The Vizcachitas Project is potentially the most advanced, ready to build copper porphyry project in South America. We look forward to working together with Fernando and his team as they advance the Vizcachitas Project towards production."
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