VANCOUVER, Jan. 16, 2015 /CNW/ – Capstone Mining Corp. ("Capstone") (TSX: CS) has entered into an amended Senior Secured Corporate Revolving Credit Facility ("RCF") for up to $500 million with Scotiabank (Co-Lead Arranger, Joint Bookrunner and Administrative Agent) and Canadian Imperial Bank of Commerce (Co-Lead Arranger, Joint Bookrunner and Syndication Agent). Other syndicate lenders include Citibank, N.A., Canadian Branch; Wells Fargo Bank N.A., Canadian Branch; Export Development Canada; Bank of Montreal; Mizuho Bank, Ltd.; and ING Capital LLC. This facility amends Capstone's existing senior secured corporate revolving term facility and allows for the repayment and cancellation of the existing senior secured reducing revolving credit facility.,
The RCF comprises a committed $440 million plus a $60 million accordion. It has a four year term maturing in January 2019 (with extension rights on mutual consent), an interest rate of US LIBOR plus 3.0% (adjustable in certain circumstances) and a standby fee of 0.675%, payable on the undrawn balance of the facility. The $60 million accordion may be exercised by Capstone once additional credit is committed from existing and/or new lenders.
"This low-cost credit facility, combined with our existing cash balance and cash flow from operations, offers Capstone significant financial flexibility to meet our operating requirements and to address potential market or operational disruptions, including periods of low copper prices," said Darren Pylot , President and CEO of Capstone. "We expect to draw approximately $265 million once the standard conditions precedents are met. This will replace our current borrowings and will eliminate our requirement for amortization, leaving us with approximately $235 million of additional credit capacity. At the same time, we maintain the option to access the high yield bond market when conditions improve if that is still appropriate for Capstone at the time."
About Capstone Mining Corp.
Capstone Mining Corp. is a Canadian base metals mining company, focused on copper. We are committed to the responsible development of our assets and the environments in which we operate. Our three producing mines are the Pinto Valley copper mine located in Arizona, US, the Cozamin copper-silver mine in Zacatecas State, Mexico and the Minto copper mine in Yukon, Canada. In addition, Capstone has two copper development projects; the large scale 70% owned copper-ironSanto Domingo project in Region III, Chile, in partnership with Korea Resources Corporation, and the 100% owned copper-zinc Kutcho project in British Columbia, Canada, as well as exploration properties in Chile. Using our cash flow and strong balance sheet as a platform, Capstone's strategy is to continue to grow with mineral resource and reserve expansions and exploration, and through acquisitions in politically stable, mining-friendly regions. We will pace our growth with our financial capacity, ensuring we retain, as a priority, sufficient financial flexibility to meet the requirements of our existing operations and our committed development projects, while maintaining an adequate cushion to deal with market volatility and operating risks inherent in the mining industry. Our headquarters are in Vancouver, Canada and we are listed on the Toronto Stock Exchange (TSX).
Cautionary Note Regarding Forward-Looking Information
This document may contain "forward-looking information" within the meaning of Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements"). These forward-looking statements are made as of the date of this document and Capstone Mining Corp. (the "Company") does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation.
Forward-looking statements relate to future events or future performance and reflect Company management's expectations or beliefs regarding future events and include, but are not limited to, statements related to the credit facility transactions, statements with respect to the estimation of mineral reserves and mineral resources, the conversion of mineral resources to mineral reserves, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "outlook", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. In this document certain forward-looking statements are identified by words including "may", "future", "expected", "intends" and "estimates". By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, commodity prices; risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of mineral resources; possible variations in ore reserves, grade or recovery rates; accidents; dependence on key personnel; labour pool constraints; labour disputes; availability of infrastructure required for the development of mining projects; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; counterparty risks associated with sales of our metals; changes in general economic conditions; increased operating and capital costs; operating in foreign jurisdictions with risk of changes to governmental regulation; impact of climatic conditions on our Pinto Valley, Cozamin and Minto operations; increasing energy prices; our ability to integrate new acquisitions into our operations, and other risks of the mining industry as well as those factors detailed from time to time in the Company's interim and annual financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward looking statements.
SOURCE Capstone Mining Corp.
