Refinancing News Releasehttps://ca.news.finance.yahoo.com/s/26042010/30/link-f-cnw-mercator-closes-previously-announced-130-million-senior-secured.html
Mercator Minerals Ltd. (the "Company") (TSX - ML) is pleased toannounce its wholly-owned subsidiary Mineral Park Inc. has closed thepreviously announced (see Press Release dated March 31, 2010) US$130million in credit facilities (the "Credit Facilities") and hasconcurrently issued the notice of redemption on May 6, 2010 of theoutstanding 11.5% Senior Secured Notes due February 16, 2012.
Société Générale and WestLB AG are the Joint Bookrunners of theCredit Facilities with Lead Arrangers Société Générale (Documentationand Administrative Agent), WestLB AG (Technical Agent), Credit Suisseand Barclays Capital (collectively, the "Lenders").
The Credit Facilities are comprised of a US$100 million term loanwith a one year grace and a five year equal quarterly amortizationcommencing March 31, 2011 and a final maturity date of March 31, 2016and a US$30 million revolving credit facility repayable on the fourthanniversary, subject to an annual extension option at the Lenders'discretion. The Credit Facilities are secured by a guarantee providedby the Company's wholly owned subsidiary Mercator Mineral Park HoldingsLtd. and include mandatory prepayments based on a variableparticipating interest in free cash flow capped at a maximum of $30million as well as other terms, conditions and covenants customarilyassociated with mining credit facilities. Pricing is initially set atLibor+4.5% per annum (current 3 month Libor rate is .31%) with gridpricing tied to the debt service coverage ratio following the firstscheduled repayment of the term loan and completion of Phase IIexpansion to 50,000tpd. The proceeds of the Credit Facilities will beused to repay the Notes.
The Notice of Redemption states that the Company will redeem theoutstanding US$120 million principal amount of Notes on May 6, 2010(the "Redemption Date"). A redemption amount of $1,089.6986 (the"Redemption Price") be paid for each US$1,000 principal amount ofNotes, being an amount equal to the aggregate of i) $1,050 for each$1,000 principal amount of Notes plus ii) all accrued and unpaidinterest up to but excluding the Redemption Date.
Further details concerning the Notes including the rights ofredemption are described in the trust indenture dated February 15, 2007and supplemental indentures dated June 12, 2008 and July 13, 2009 madebetween the Company and Computershare Trust Company of Canada, asTrustee. Copies of the indenture and supplemental indentures can befound on SEDAR and hard copies can be obtained from the Trustee.
"We consider this refinancing a milestone in the evolution ofMercator Minerals as a growing mid tier North American copper andmolybdenum producer", said Michael Surratt, President & CEO ofMercator Minerals Ltd. "The support of these internationally renownedbanks in refinancing our debt on such commercially favorably termsrecognizes the operating advances at Mineral Park and the long reservelife. We are also appreciative of the support of our note holders forthe funding which allowed Mercator to advance Mineral Park quickly andthrough one of the worst economic down turns in history."