RCF IV & VI: Latest Update Resource Capital Fund IV L.P. and Resource Capital Fund VI L.P.
Acquire Shares of Alloycorp Mining Inc. pursuant to Loan Agreements
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JANUARY 22, 2015 11:59 AM EST
DENVER, Jan. 22, 2015 /CNW/ - Resource Capital Fund IV L.P. ("RCF IV") and Resource Capital Fund VI L.P. ("RCF VI") report that they have acquired in aggregate 34,833,000 common shares of Alloycorp Mining Inc. (the "Acquired Shares") in accordance with the terms of the Amended and Restated Loan Agreement dated July 12, 2013, as amended on December 31, 2014, between Alloycorp Mining Inc. ("Alloycorp"), its wholly-owned subsidiary, Avanti Kitsault Mine Ltd. ("AKM"), RCF IV and RCF VI (the "Bridge Loan Agreement") as well as in accordance with the terms of the Preconstruction Loan Agreement dated December 19, 2013, as amended on December 31, 2014, between Alloycorp, AKM and RCF VI (collectively with the Bridge Loan Agreement, the "Loan Agreements").
Pursuant to the Loan Agreements, RCF IV and RCF VI (collectively, "RCF"), as applicable, may accept common shares of Alloycorp ("Common Shares") for amounts payable under the Loan Agreements. The Acquired Shares are subject to a four-month hold period and consist of:
5,805,500 Common Shares to RCF IV in respect of interest accrued for the period from October 1, 2014 to December 31, 2014 pursuant to the Bridge Loan Agreement;
5,805,500 Common Shares to RCF VI in respect of interest accrued for the period from October 1, 2014 to December 31, 2014 pursuant to the Bridge Loan Agreement; and
23,222,000 Common Shares to RCF VI in respect of interest accrued for the period from October 1, 2014 to December 31, 2014 pursuant to the Preconstruction Loan Agreement.
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The loans made pursuant to the Loan Agreements are convertible into Common Shares at a conversion price of C$0.07 per Common Share in respect of the Bridge Loan Agreement and C$0.055 per Common Share in respect of the Preconstruction Loan Agreement (collectively, the "Conversion Shares"). Additionally, RCF holds warrants to purchase up to 25,000,000 Common Shares, 10,000,000 of which are exercisable at C$0.135 until June 29, 2015 and 15,000,000 of which are exercisable at C$0.085 until July 12, 2016 (the "Warrants"). The Warrants were granted in conjunction with the Loan Agreements and previous lending arrangements between Alloycorp and RCF.
RCF IV and RCF VI are under common management by RCF Management LLC. Prior to receiving the Acquired Shares, RCF owned and controlled approximately 50.4% of the outstanding Common Shares. Including the Acquired Shares, RCF now owns and controls 312,398,583 Common Shares representing approximately 53.4% of the outstanding Common Shares. Assuming the exercise of the Warrants and the conversion of the Conversion Shares, RCF would own and control 1,681,315,466 Common Shares representing approximately 86.0% of the outstanding Common Shares on a partially diluted basis.
The Acquired Shares were acquired for investment purposes. RCF may in the future decide to invest in the Common Shares and, if so, RCF will evaluate any future investment in Alloycorp from time to time and may, based on such evaluation of market conditions and other circumstances, increase or decrease shareholdings in Alloycorp as circumstances require.
SOURCE Resource Capital Fund IV L.P.