Amerigo announces new loan facilities
(Amounts in US dollars unless otherwise indicated)
VANCOUVER, British Columbia, June 30, 2021 (GLOBE NEWSWIRE) – Amerigo Resources Ltd. (TSX: ARG; ARREF: OTC) (“Amerigo” or the “Company”) is pleased to provide the following update regarding the credit facilities of Minera Valle Central (“MVC”), the Company’s 100% owned operation located near Rancagua, in Chile.
On June 30, 2021, MVC completed a restructuring of its credit facilities which included:
a) Full repayment of the remaining principal amount of $ 42.2 million that remained unpaid under MVC’s existing credit facility, together with interest and accrued charges.
b) The conclusion of a new financing agreement (the “Loan Agreement”) with a syndicate of two banks domiciled in Chile, with Itaú Corpbanca (“Itaú) as principal arranger, under which MVC received a replacement term loan and a working capital line of credit. The key terms of the loan agreement are:
A. Term loan:
|•||Amount of the facility:||$ 35 million, disbursed on June 30, 2020|
|•||Term:||Up to 5 years, with authorized prepayments|
|•||Refund:||10 equal, semi-annual payments of $ 3.5 million each, starting December 31, 2021 and ending June 30, 2026|
|•||Interest rate:||For 75% of the facility – 5.48% secured by an interest rate swap|
|For 25% of the facility – Libor 6M plus a margin of 3.90%|
B. Working capital line of credit:
|•||Amount of the facility:||Up to $ 15 million|
|•||Availability:||Multiple disbursements, over an availability period from June 30, 2021 to June 30, 2023|
|•||Term:||Up to 2 years for each disbursement, from each disbursement date|
|•||Refund||4 equal and semi-annual payments for each disbursement, the first repayment being payable within 6 months of the date of disbursement.|
|•||Interest rate:||Libor 6M plus a margin to be defined on each disbursement date|
“We are pleased to now have in place a full credit facility consisting of a 5-year term loan and a working capital line of credit to protect the company against potential market cyclicality,” said said Aurora Davidson, President and CEO of Amerigo. She added, “The new facility meets our goals of restructuring debt to improve business conditions and move away from a project finance facility with covenants, giving Amerigo significant flexibility to access surpluses. cash generated by operations. We look forward to building a strong business relationship with two of Chile’s leading banks.
Amerigo Resources Ltd. is an innovative copper producer with a long-term relationship with Corporación Nacional del Cobre de Chile (“Codelco”), the world’s largest copper producer.
Amerigo produces copper concentrate and molybdenum concentrate as a by-product at the MVC operation in Chile by processing fresh and historic tailings from Codelco’s El Teniente mine, the world’s largest underground copper mine. Phone. : (604) 681-2802; Fax: (604) 682-2802; Web: www.amerigoresources.com; Listing: ARG: TSX.
For more information, please contact:
|Aurore Davidson||Graham Farrell|
|President and CEO||Investor Relations|
|(604) 697-6207||(416) 842-9003|
|[email protected]||[email protected]|
Caution regarding forward-looking information
This press release contains certain forward-looking information and statements as defined in applicable securities laws (collectively referred to as “forward-looking statements”). These statements relate to future events or the future performance of the Company. All statements other than statements of historical fact are forward-looking statements. The use of any of the words “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “can”, “plan”, “predict”, “possible” “,” Should “,” believe “and similar expressions are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding the Company’s future ability to access excess cash generated from operations and that the working capital line of credit may protect the Company against potential market cyclicality. .
These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such statements. Forward-looking statements involve risks and uncertainties beyond our ability to predict or control, including risks that may affect our business or investment plans; risks typically encountered in obtaining permits and developing mining projects such as unusual or unexpected geological formations, negotiations with government and other third parties, unforeseen metallurgical difficulties, delays associated with permits, approvals and permit calls, ground control issues, adverse weather conditions, process disturbances and equipment malfunctions; risks associated with labor disruption and the availability of skilled labor and management; risks related to the potential impact of global or national health issues, including COVID-19, and the inability of employees to access sufficient health care; government or regulatory actions or inactions; fluctuations in the market prices of our main raw materials, which are cyclical and subject to significant price fluctuations; risks created by competition for mining projects and properties; risks associated with lack of access to markets; risks associated with the availability and our ability to obtain both tailings from current production from Codelco’s El Teniente division and historical tailings from tailings depots; risks relating to the Company’s ability to draw funds from bank facilities and lines of credit and the Company’s availability and ability to obtain adequate financing on reasonable terms for expansions and acquisitions; mining plan estimates; risks posed by fluctuations in exchange rates and interest rates, as well as general economic conditions; risks associated with environmental compliance and changes in environmental laws and regulations; risks associated with our reliance on third parties for the provision of critical services; risks associated with non-performance of contractual counterparties; title risks; social and political risks associated with operations in foreign countries; risks of changes in laws affecting our operations or their interpretation, including currency controls; and the risks associated with tax adjustments and lawsuits. Notwithstanding the efforts of the Company and MVC, there can be no assurance that Company or MVC personnel will not contract COVID-19 or that Company and MVC measures to protect personnel against COVID-19 will be effective. . Many of these risks and uncertainties apply not only to the Company and its operations, but also to Codelco and its operations. Codelco’s ongoing mining operations provide a significant portion of the materials the Company processes and the resulting metal production. Therefore, these risks and uncertainties may also affect their operations and in turn have a material effect on the Company.
Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this press release. Such statements are based on several assumptions which may prove to be incorrect, including, but not limited to, assumptions regarding:
- general commercial and economic conditions;
- interest rate;
- changes in the prices of raw materials and electricity;
- acts of foreign governments and the outcome of legal proceedings;
- supply and demand, deliveries, level and price volatility of copper and other raw materials and products used in our operations;
- the continued supply of processing from Codelco’s current mining operations;
- the Company’s ability to profitably extract and process materials from the Cauquenes tailings repository;
- the timing of receipt and retention of permits and other regulatory and government approvals;
- our production costs and levels of production and productivity, as well as those of our competitors;
- changes in credit market conditions and general financial market conditions;
- our ability to purchase sufficient and timely equipment and operating supplies;
- the availability of qualified employees and contractors for our operations;
- our ability to attract and retain qualified personnel;
- satisfactory negotiation of collective agreements with unionized employees;
- the impact of changes in exchange rates and repatriation of capital on our costs and results;
- engineering and construction schedules and capital costs for our expansion projects;
- the costs of closing various operations;
- competition in the market;
- the accuracy of our preliminary economic assessment (including with respect to size, grade and recovery capacity) and the geological, operational and pricing assumptions on which they are based;
- tax benefits and tax rates;
- the outcome of our negotiations on the sale and processing of copper concentrates and on refining costs;
- the resolution of environmental and other proceedings or disputes;
- the future supply of electricity at a reasonable price;
- precipitation near the MVC continues to trend towards normal levels;
- average recoveries for fresh tailings and Cauquenes tailings;
- our ability to obtain, comply with and renew permits and licenses in a timely manner; and
- our ongoing relationships with our employees and the entities with which we do business.
Future production levels and cost estimates assume that there are no mining or other adverse events that significantly affect budgeted production levels. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond the control of the Company, the Company cannot guarantee that it will achieve or achieve the expectations, beliefs or projections described in the forward-looking statements.
We caution you that the foregoing list of important factors and assumptions is not exhaustive. Other events or circumstances could cause our actual results to differ materially from those estimated or projected and expressed or implied by our forward-looking statements. You should also carefully consider the issues discussed under Risk factors in the Company’s Annual Information Form. The forward-looking statements contained in this document speak only as of the date of this press release and, except as required by law, we do not undertake to publicly update or otherwise revise any forward-looking statements or previous list of factors, whether as a result of new information or future events or otherwise.