Almonty Industries Inc. Completes A Non-Brokered Phase One Financing For The Construction of their Sangdong Mine of EUR€3.25 Million Plus US$500,000
JUL 13, 2020 | INVESTMENT INFORMATION, KOREA TUNGSTEN, NEWS RELEASE
Toronto – July 13, 2020 – Almonty Industries Inc. (“Almonty”) (TSX: AII / OTCQX: ALMTF / Frankfurt: 1MR) announces it has completed a non-brokered private placement of secured convertible bonds in the principal amount of EUR€3,250,000 (equivalent to approximately US$3,675,000 or Cdn$5,000,000) (the “Bond Offering”) as well as a secured loan of US$500,000 (approximately Cdn$680,000) for a total of Cdn$5,680,000.
All securities issued pursuant to the Bond Offering are subject to a six month non-exercise period expiring on January 14th, 2021. Almonty intends to use the net proceeds of the Bond Offering for Sangdong Mine project financing expenses and for general corporate purposes.
The secured convertible bonds (the “Bonds”) will mature on July 13, 2023, and will bear interest at a rate of 10% per annum, payable semi-annually, in cash. The outstanding principal amount of the Bonds plus any related unpaid accrued interest is convertible into common shares of Almonty at the option of the holder at the fixed conversion price of EUR€0.35 (equivalent to CDN$0.54) per share for the principal and at the conversion price of the greater of i) EUR€0.35 (equivalent to CDN$0.54) and ii) the EUR equivalent of the volume weighted average price of the Common Shares on the Toronto Stock Exchange for the five trading days immediately preceding the date of conversion for related accrued interest.
The secured loan bears interest at the rate of 6% per annum payable upon the maturity date, being January 22, 2021.
Almonty’s Chairman, President and CEO Lewis Black said:
“We are very pleased to announce that we have closed on the US$4.1 million owner’s cost portion of the financing. This represents Phase I of the financing for the build-out of our Sangdong Mine Project in South Korea which is described as Owner’s Costs within the financial model that is driving the project financing.
This leaves approximately US $23.1 million to be raised, of which US $10 million for the DSRA (debt service reserve account) is expected to be met with a bank guarantee or line of credit, with the remaining US $13.1 million to be raised through a hybrid/mezzanine/bond financing structure. This mixed structure Owner’s Cost financing, combined with the already announced US$75 million Project financing note at libor plus 2.3%, creates in its entirety, an affordable Total project financing package while simultaneously minimizing shareholder dilution.
Almonty is now in possession of the definitive loan documents for the KfW-IPEX Bank Project financing, which we expect to execute later in July 2020.
We are now beginning the scheduling work with POSCO, the EPC contractors, for mobilization dates and with Metso, the plant equipment supplier, for the order dates for the long lead time equipment for the crushing circuit. We are also commencing the construction of the Monty B portal in August which is the main ore portal. The waste portal Alphonse D was completed late last year.”