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MINNEAPOLIS, July 08, 2020 (GLOBE NEWSWIRE) -- Global private investment firm Castlelake, L.P. (“Castlelake”), today announced that on July 7, 2020, funds managed by Castlelake acquired from Pala Investments Limited (“Pala”) an amount equal to US$13,400,000 (the “Acquired Amount”) of the principal amount of the US$30,000,000 convertible loan facility (the “Convertible Loan”) entered into by Nevada Copper Corp. (“Nevada Copper”) with Pala on March 27, 2020 (the “Transaction”). The Transaction was made in accordance with the transfer provisions of the Convertible Loan. In connection with the Transaction, Castlelake funds have paid cash consideration to Pala in an amount equal to US$12,472,600 (which is equivalent to CAD$16,891,642 based on the Bank of Canada exchange rate of US$1 = CAD$1.3543 as of the close of business on July 6, 2020).
Castlelake, on behalf of its funds, may, at any time, and from time to time, convert all or a portion of its proportion of the principal amount of the Convertible Loan, plus any accrued interest thereon, into common shares of Nevada Copper (“NCU Shares”) at a price per NCU Share equal to C$0.1575 (the “Conversion Price”). The Convertible Loan bears interest at an annual rate of 14%, quarterly in arrears, and matures in March 2024. Nevada Copper has the option to pay the accrued interest under the Convertible Loan in cash if permitted to do so under its existing financing arrangements. In the event Nevada Copper elects not to pay such interest in cash, each of the lenders has the option to either: (i) receive the amount of such interest payment through the issuance of NCU Shares based on the market price (as defined in the policies of the TSX) of the NCU Shares at the time of such interest payment; or (ii) add the amount of such interest payment to the then outstanding principal amount of the Convertible Loan held by such lender (which shall thereafter accrue interest at the interest rate under the Convertible Loan), in which case such interest will either be repaid on maturity of the Convertible Loan or converted into NCU Shares at the Conversion Price. The Convertible Loan is also repayable subject to a make whole amount, whereby the lenders will receive the balance of all remaining interest amounts to the end of the full term of the Convertible Loan, upon certain change of control events.
Immediately prior to the Transaction, Castlelake funds owned 136,632,313 NCU Shares, representing approximately 16.7% of the issued and outstanding NCU Shares. After giving effect to the Transaction, (i) Castlelake funds continue to hold the same number of NCU Shares and the same percentage of the issued and outstanding NCU shares; and (ii) assuming the conversion of the Acquired Amount at the Conversion Price and assuming all interest under the Convertible Loan is capitalized and converted at maturity at the Conversion Price (collectively, the “Castlelake Issuances”), Castlelake funds would hold the following aggregate number of NCU Shares:
| Exchange Rate (based on the Bank of Canada closing rate as of July 6, 2020) | Total number of NCU Shares issued to Castlelake funds pursuant to Castlelake Issuances | Total number of NCU held by Castlelake funds assuming Castlelake Issuances | % of NCU Shares owned by Castlelake funds assuming Castlelake Issuances(1) | ||
| US$1 = CAD$1.3543 | 194,494,302 | 331,126,615 | 32.6% |
(1) Assumes conversion of the Convertible Loan by Castlelake only (assuming all interest related to Castlelake’s portion of the Convertible Loan is capitalized and converted at maturity at the Conversion Price).
Castlelake funds have acquired these securities for investment purposes and may increase or decrease the investment in the securities of Nevada Copper depending on its evaluation of the business, prospects and financial condition of Nevada Copper, the market for Nevada Copper’s securities, general economic and tax conditions and other factors.
Pala and Castlelake funds have relied on the private agreement exemption in accordance with Section 4.2(1) of National Instrument 62-104 – Take-Over Bids and Issuer Bids as the Transaction may result in Castlelake funds holding an aggregate amount of NCU Shares that is greater than 20% of the outstanding NCU Shares on a fully diluted basis. Such exemption is available with respect to the Transaction due to the fact that (a) the acquisition by Castlelake funds was made from Pala alone and not from more than 5 persons in the aggregate, (b) no offer was made by Castlelake funds to purchase any NCU Shares generally to security holders and (c) the value of the consideration paid by Castlelake funds to Pala is not greater than 115% of the market price of the Convertible Loan.
For further information, please refer to the Early Warning Report filed on SEDAR under the company’s profile or please contact Molly Blemker at (+1 612 851 3083). Nevada Copper is a corporation organized under the laws of British Columbia with its head office at Suite 598 - 999 Canada Place Vancouver, BC, V6C 3E1.
About Castlelake
Castlelake, L.P. is a global private investment firm focused on investments in alternative assets, sub-performing loans, dislocated industries and corporate special situations, and is an experienced leader in aircraft ownership and servicing. With primary offices in Minneapolis and London, the Castlelake team comprises more than 190 professionals. As of June 30, 2020, Castlelake manages private funds and debt vehicles with approximately $16.5 billion in assets, on behalf of its investors, including endowments, foundations, public and private pension plans, private funds, family offices, insurance companies and sovereign wealth funds. For more information, visit www.castlelake.com.
Media Contact
Molly Blemker
+1 612 851 3083