Sprott Private Resource Lending provided a $15 million credit facility to Alexco. The funds will be used to develop the Keno Hill Silver projects located in Yukon, Canada.
Narinder Nagra, managing partner of Sprott, said, “As one of the largest investors dedicated to the natural resource sector, Sprott is excited to partner with Alexco on the restart of the project. Our partnership with the Alexco team is consistent with our strategy of providing innovative and flexible capital to maximize the value of exceptional projects.”
Terms of the credit facility include:
- A maturity date of February 23, 2021
- An interest rate on funds drawn down: the greater of 7% plus U,S, dollar three-month LIBOR and 8% per annum, payable monthly
- Repayment in quarterly installments from October 31, 2019 through to the maturity date
- Upon draw down of funds, a 3% charge of the draw down
- 1 million share purchase warrants issued to Sprott with a five-year term, an exercise price of C$2.25 ($1.78) per share and a right by the company to accelerate the expiry date to 30 days following the closing price of the shares exceeding C$5.63 ($4.45) for more than 20 consecutive trading days
- Repayments in whole or in part, without penalty, provided not less than 12 months of interest has been paid on any outstanding amount
- An option to extend the availability period of draw down from 12 to 18 months by issuing to Sprott 171,480 Alexco common shares
Alexco owns 100% of the high-grade Keno Hill Silver District and provides mine-related environmental services, remediation technologies and reclamation and mine closure services to both government and industry clients.