Noront Resources Extends Debt Arrangement With Resource Capital Funds and Issues Interest Shares
TSX VENTURE: NOT
TORONTO, Jan. 31, 2019 (GLOBE NEWSWIRE) -- Noront Resources Ltd. (“Noront” or the “Company”) (TSX Venture: NOT) has entered into a fifth amending agreement dated January 31, 2019 (the “Fifth Amending Agreement”) with its largest shareholder, Resource Capital Fund V L.P. (“RCF V”), to extend the term of its existing US$15 million convertible debenture (the “Convertible Debenture”). Subject to TSX Venture Exchange approval, the maturity date of the Convertible Debenture has been extended until September 30, 2019 (previously January 31, 2019). The amendment includes a provision whereby the Company will require RCF approval to issue equity below $0.306 per share. All other material terms and conditions remain the same. Interest is paid in common shares, subject to TSX Venture Exchange approval, quarterly in arrears with the interest rate remaining the same at 8% per annum. The Convertible Debenture may be converted into common shares of the Company ("Common Shares") at the option of RCF V at a price of CDN $0.34 per Common Share at any time prior to September 30, 2019.
RCF V is a "related party" of Noront as RCF V is a person that has beneficial ownership of, and control or direction over, directly or indirectly, securities of Noront carrying more than 10% of the voting rights attached to all of Noront's outstanding voting securities. As a result, the entering into of the Fifth Amending Agreement is a "related party transaction" pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"), incorporated by reference into Policy 5.9 – Protection of Minority Security Holders in Special Transactions of the TSX Venture Exchange. Noront is relying on (i) the exemption set forth in sections 5.5(b) and (g) of MI 61-101 from the formal valuation requirement, and (ii) the exemption set forth in section 5.7(e) of MI 61-101 from the "minority approval" requirement, in connection with entering into the Fifth Amending Agreement.
The Company also announces that payment of interest in the amount of $409,140 for the fourth quarter of 2018 pursuant to a loan agreement entered into between Noront and RCF V dated February 26, 2013 has been satisfied by the issuance of 1,760,499 Common Shares (the “Interest Shares”) to RCF V at an effective price of $0.2324 per Interest Share. The Interest Shares were issued to RCF V on January 10, 2019 and remain subject to a four month hold period expiring on May 11, 2019. The calculation of the number of Interest Shares issued was based on the volume weighted average trading price of the Common Shares during the 20 trading days prior to December 31, 2018. After giving effect to the issuance of the Interest Shares, there are 380,137,261 Common Shares issued and outstanding.
About Noront Resources
Noront Resources Ltd. is focused on the development of its high-grade Eagle’s Nest nickel, copper, platinum and palladium deposit and the world class chromite deposits including Blackbird, Black Thor, and Big Daddy, all of which are located in the James Bay Lowlands of Ontario in an emerging metals camp known as the Ring of Fire. For more information please visit www.norontresources.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This press release includes certain “forward-looking information” within the meaning of applicable Canadian securities legislation.
Forward-looking information is based on reasonable assumptions that have been made by Noront as at the date of such information and is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Noront to be materially different from those expressed or implied by such forward-looking information, including but not limited to: the impact of general business and economic conditions; that all conditions precedent to the transactions will be met; risks related to government and environmental regulation, actual results of current exploration activities, conclusions of economic evaluations (including those contained in the Feasibility Study) and changes in project parameters as plans continue to be refined; problems inherent to the marketability of base and precious metals; industry conditions, including fluctuations in the price of base and precious metals, fluctuations in interest rates; government entities interpreting existing tax legislation or enacting new tax legislation in a way which adversely affects Noront; stock market volatility; competition; risk factors disclosed in Noront’s most recent Management’s Discussion and Analysis and Annual Information Form, available electronically on SEDAR; and such other factors described or referred to elsewhere herein, including unanticipated and/or unusual events. Many such factors are beyond Noront’s ability to control or predict.
Although Noront has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate as actual results and future events could differ materially from those reliant on forward-looking information.
All of the forward-looking information given in this press release is qualified by these cautionary statements and readers are cautioned not to put undue reliance on forward-looking information due to its inherent uncertainty. Noront disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, except as required by law. This forward-looking information should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.