Deep Sea Mining Finance will continue to provide bridge loans to Nautilus Minerals to support the latter’s development of its seafloor production system. The loans are expected to form part of a larger secured structured credit facility of up to $34 million.

Nautilus so far has received bridge loans totaling $6.65 million. In conjunction with the most recent advance of $1.9 million, the company issued an additional 8,161,512 warrants to Deep Sea, for a total of 28,565,291 share purchase warrants to date. Each warrant entitles Deep Sea to purchase one common share of the company at a price of C$0.17 ($0.13) for a period of five years from the date of issuance of the warrant.

The loans bear interest at 8% per annum, payable bi-annually in arrears with a one year maturity date. Nautilus will be entitled to pre-pay each loan prior to maturity, by paying 108% of the outstanding principal of the loan plus accrued and unpaid interest. Each loan is represented by a promissory note and will initially be secured against the assets of the company through a general security agreement. Deep Sea may subsequently require the loan to be guaranteed by Nautilus’ material operating subsidiaries and secured against the assets of such subsidiaries.

In addition to the production system development, the bridge loans will be used to meet immediate working capital requirements.