ENP Newswire -
Release date- 06062014 -
The Bridge Loan has been structured as a 24 month secured facility to be made available to the Company in two tranches with an interest rate of Libor plus 15%. Upon completion of the Bridge Loan, a copy of the agreement will be available for review on Chieftain's SEDAR profile at www.sedar.com.
Proceeds from the first tranche in the amount of
The second tranche provides the Company the ability to draw the Canadian dollar equivalent of
Unless renegotiated, the Company has the obligation to repay, on
The Bridge Loan is subject to definitive documentation, an intercreditor agreement between
The Feasibility Update is expected to incorporate improvements to the Project including (a) optimizing the production configuration, cost of capital, operating costs and mill size; (b) reconfiguring the copper circuit to produce two copper concentrates rather than one, thereby improving marketability of the copper concentrates in aggregate and (c) the addition of proven reserves to the mine plan. Chieftain expects the Feasibility Update will be completed by the end of the third calendar quarter of 2014.
Related Party Transaction
As well, the Bridge Loan is exempt from the minority approval requirements of MI 61-101 as (i) the Bridge Loan was made on reasonable commercial terms that are not less advantageous to Chieftain than if it were obtained from a person dealing at arm's length with Chieftain and (ii) neither the Bridge Loan (and advances thereunder) nor the principal and interest payable thereunder are convertible, directly or indirectly, into equity or voting securities of Chieftain or its subsidiary or are otherwise participating in nature.
A material change report in respect of the Bridge Loan will be filed less than 21 days before the closing of the transaction which Chieftain considers to be reasonable and necessary given the time required to conclude definitive documentation and the need to improve Chieftain's financial condition in a timely manner.
The Bridge Loan is subject to the disinterested shareholder approval requirements of section 501 of the TSX Company Manual as (i) Chieftain is a 'non-exempt' issuer pursuant to the rules of the TSX; (ii)
President & CEO
Tel: (416) 479-5411
Chief Financial Officer
Tel: (416) 479-5412
Cautionary Statement Regarding Forward-Looking Information
This press release contains forward-looking information. All statements, other than statements of historical fact, are forward-looking and can be identified by the use of future-oriented words and phrases including without limitation 'may', 'will', 'could', 'subject to', 'expects' and variations and negatives thereof.
The forward-looking information included in this press release include statements with respect to: the obtaining of disinterested shareholder approval by Chieftain in order to fund advances under the Bridge Loan and the intended use and sufficiency of proceeds therefrom; Chieftain's potential obligation to repay deposited amounts under the Streaming Agreement to
Forward-looking information contained in this document is based on the opinions and estimates of management as well as certain assumptions considered by management to be reasonable and which are made as at the date the information is given (including, in respect of the forward-looking information contained in this press release, assumptions regarding Chieftain's ability to obtain regulatory approval for the funding of advances under the Bridge Loan, the expected cost of funding and the timing requirements to complete the Feasibility Update and the projected working capital requirements of Chieftain, the potential obligation of Chieftain to repay amounts under the Streaming Agreement, and assumptions and factors regarding Chieftain's mineral properties which management expects to be supported by the Feasibility Update).
Readers should be cautioned that forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information.
Material risks include without limitation: that Chieftain may not be able to obtain disinterested shareholder approval or obtain regulatory approval to fund advances under the Bridge Loan, or that funding conditions under the Bridge Loan will not be met; the cost and timing of the Feasibility Update may exceed management's expectations and/or may not result in the optimizations to the Project expected by management; advances under the Bridge Loan may be insufficient to address the intended use of proceeds as expected by management, inherent risks involved in the exploration and development of Chieftain's mineral properties, volatility of metal prices and other factors.
Readers are cautioned to not place undue reliance on forward-looking information because it is possible that predictions, forecasts, projections and other forms of forward-looking information will not be achieved by Chieftain. The forward-looking information contained herein is made as of the date hereof and Chieftain assumes no responsibility to update or revise it to reflect new events or circumstances, except as required by law.
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