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East Asia Minerals Corp to secure credit facility loan

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Global Mining Review,


East Asia Minerals Corporation has announced that it has entered into an arrangement with Isatis Capital Group of Montreal to secure a credit facility loan for up to CAN$17 500 000 (US$13 500 000).

East Asia Minerals Corporation has announced that it has entered into an arrangement with Isatis Capital Group of Montreal to secure a credit facility loan for up to CAN$17 500 000 (US$13 500 000).

The contemplated credit facility arranged will have a maturity of 48 months with EAS being able to terminate the loan at 36 months with a 2% penalty on remaining funds owed and will be secured by a universal deed of hypothec over the Sangihe project in Indonesia. The loan will have an interest rate of 8% and will consist of interest only payments for the first 18 months of its tenure. The loan, at the discretion of the lender(s) is convertible to 99.9 gold bullion as a vehicle of repayment with 12 months advanced notice and contained within a formal offtake agreement.

The credit facility will be made available to EAS through the issuance in the US of secured and convertible notes maturing at 48 months relying up rule 506 (c) of Regulation D promulgated under the Securities Act, 1933 as amended.

The financing described herein is contingent to market conditions and regulatory approval in the US and Canada.

Funds will be used to bring the Sangihe Gold project into production, exploration and infill drilling of the Binebase/Bawone Corridor to increase both resources and reserves, as well as general working capital.

The company’s has completed the Indonesian Feasibility Study (IFS) and AMDAL Environmental reports and once they are submitted and accepted by the Indonesian Mining Department (MEMR), construction of the mining facilities and infrastructure can begin at the Sangihe project. The company anticipates making a decision for gold processing and production to begin in 2018. The IFS is not a feasibility study as defined by CIM as required by NI 43-101, but is required under Indonesian law in order to obtain a licence to construct a production facility. The IFS will be re-issued within 30 days as a pre-feasibility study, which will identify if all or part of the mineral resource may be converted to a mineral reserve at the time of reporting. The company cautions readers that the any production decision made by the company will not be based on a NI 43-101 feasibility study of mineral reserves that demonstrates economic and technical viability and as such, there may be involved increased uncertainty and various technological and economic risks.

Terry Filbert, President & CEO of East Asia Minerals Corporation commented: “This funding solution enables EAS to move forward aggressively on long-term plans to develop the Sanghie property to generate revenue and positive cash flow for the company, which will enable us to finishing drilling our the Sangihe and increase production and mine life, as well as having the recourses to devote to our Miwah project. This will put the company on a fast track to increase shareholder value in a non-dilutive manner.”

Sangihe gold-copper project

The Sangihe gold-copper project is located on the island of Sangihe off the northern coast of Sulawesi and has an existing National Instrument 43-101 inferred mineral resource of 114 700 indicated and 105 000 inferred ounces of gold. The company’s 70% interest in the Sangihe mineral tenement contract of work (CoW) is held through PT Tambang Mas Sangihe (PTTMS). The remaining 30% interest in PTTMS is held by three unaffiliated Indonesian corporations. The term of the Sangihe CoW agreement is for 30 years upon commencement of the production phase of the project.

The company also announces that it has closed the first tranche of a non-brokered private placement of 2 200 000 units of the company (the units) at CAN$0.05 per unit for gross proceeds of CAN$111 000 (the offering).

Each unit consists of one common share in the capital of the company (a share) and one share purchase warrant (warrant). Each warrant entitles the holder to purchase one additional common share in the capital of the company (warrant share) at a price of CAN$0.10 per warrant share for a period of two years from the closing of the offering.

The company has paid eligible finders a cash commission in the aggregate amount of approximately CAN$3570 and 71 400 finders warrants (finders warrants) on the offering within the amount permitted by the policies of the TSX Venture Exchange (the exchange). Each finders warrant entitles the holder to purchase one common share in the capital of the company at a price of CAN$0.10 for a period of two years from the closing of the offering. All securities issued in connection with the offering will be subject to a statutory hold period of four months plus a day from the date of issuance in accordance with applicable securities legislation.

The net proceeds of the offering after payment of commissions will be used by the company to pay expenses related to the company’s properties in Indonesia, settle payables and for working capital.

Read the article online at: https://www.globalminingreview.com/finance-business/04062018/east-asia-minerals-corp-to-secure-credit-facility-loan/

 

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