RE: Watchout for MitsubishiCare to elaborate about that clout over financing arrangements that you see? Nothing wrong with being diversified, but I believe that the risk/reward ratio is very good here.
I don't see any problem with the financing since the finance project agreements are already signed and they have started to use that money to build the mine. The deals were signed with a consortium of Japanese banks and the Japan Bank of international Cooperation. So Mitsubishi doesn't have $250 million in debt invested in this project and I don't see how they could mess around with financing and why they would even try to do that since they are in part accountable for this debt.
Keep your eyes on the ball if you want to get it out of the park!
https://www.cumtn.com/sitemanager/_pdf_financials/100630_CMMC_Financial_Statements.pdf
Project finance agreements for US$ 322 Million
In May 2010 the Company completed the project finance agreements for the development of the Copper Mountain Project in the amount of US$322 Million. The project financing consists of two tranches: (1) a Senior Credit Facility for US$162 Million provided by a consortium of Japanese banks and (2) a Term Loan of US$160 Million provided by the Japan Bank for International Cooperation.
(i) Senior Credit Facility
The maximum available under the senior credit facility ("SCF") is US$162 Million. The SCF carries a variable interest rate of LIBOR plus 2% and matures on June 15, 2023. Under the terms of the SCF the Company is required to complete an interest rate swap on 70% of the principal amount of the facility within 45 days of closing. This was completed subsequent to the end of the period. (see also note 13 Subsequent Events). As at June 30, 2010 the Company had not drawn any funds on the SCF.
The SCF principal is repayable commencing December 15, 2011 and semi-annually thereafter over a twelve year period on an accelerating basis, with 40% of the principal balance due in the final two years before maturity.
The obligations under the SCF are secured by all the assets of the Copper Mountain Project and the loan is insured by Nippon Export and Investment Insurance. In addition, the Company and MMC have guaranteed the SCF until commercial production is achieved.
(ii) Term Loan
The maximum available under the term loan ("Term Loan") is US$160 Million. The Term Loan carries a variable interest rate of LIBOR plus 0.551% and matures on February 10, 2022. As at June 30, 2010 the company had drawn US$116 Million of this facility and accrued US$54,688 (Canadian $58,221) in interest payable. The Term Loan is unsecured and is repayable in increasing installments every six months commencing February 2010, with the majority of the loan falling due in the last six installment dates of the Term Loan.