Alexco extended the draw down availability period on its previously established definitive credit agreement with Sprott Private Resource Lending to provide a $15 million credit facility to be used for the development of the Keno Hill Silver projects located in Yukon, Canada.
Pursuant to the terms of the agreement, Alexco issued 171,480 common shares of the company to extend the draw down availability period by six months.
Clynt Nauman, Alexco chairman and CEO, commented, “With the extension of the draw down availability period of the credit facility, we are simply maintaining this back-stop and financing alternative while waiting for final permitting for the Bermingham deposit to be completed – currently anticipated at the end of Q2-2019. We remain on target to announce the results of our pre-feasibility study before the end of Q1 and continue to target a production decision in the first half of 2019 subject to market conditions. The credit facility carries a total interest charge of approximately 9.75% on funds drawn down, has no minimum drawdown requirement and does not carry a stand-by charge. Retaining the facility as a back-stop allows the company to easily move to a production decision while managing project risk and minimizing shareholder dilution.”
Key terms of the facility included:
- A maturity date of February 23, 2021
- An interest rate on funds drawn down of 7% plus USD 3-month LIBOR, payable monthly
- Repayable in quarterly installments from October 31, 2019 until the maturity date
- Upon draw down of funds a 3% charge of the draw down is charged
- Repayable in whole or in part, without penalty, provided not less than twelve months of interest has been paid on any outstanding amount