Ivernia Announces One Year Extension of Secured Loan Facility
TORONTO, ONTARIO -- (Marketwire) -- 10/17/12 -- All Dollar Amounts are in U.S. Dollars ("US$") Unless Otherwise Indicated
Ivernia Inc. ("Ivernia" or the "Company") (TSX: IVW) today announced that Enirgi Group Corporation ("Enirgi Group"), the Company's majority shareholder, has approved Ivernia's previously announced request to extend the maturity date of its Canadian Dollar ("C$") $6 million secured loan facility with Enirgi Group (the "Facility") by one year pursuant to the terms and conditions of the Facility. The Facility, which was set to expire on June 28, 2013, will now expire on June 28, 2014 (the "Maturity Date"). Any interest accrued as of June 28, 2013 will be payable on that date with remaining accrued interest payable in arrears upon the earlier of the pre-payment of principal or the Maturity Date.
Funds drawn down on the Facility bear interest at an annual simple rate of 8.3%. The Facility remains secured by a first priority perfected security interest granted over the stockpile of approximately 10,100 dry metric tonnes of lead carbonate concentrate held at the Magellan lead mining operations located in Western Australia (the "Mine").
As previously announced on October 11, 2012, plans are well advanced to restart operations during the second quarter of 2013 at the Mine. As at October 5, 2012, the Company had approximately $2.0 million in cash and approximately C$2.0 million remaining to be drawn down on the Facility to fund activities and any costs associated with the restart of operations.
As previously disclosed, the Company will require additional financing to underwrite the restart of operations at the Mine, in excess of current cash balances, the remaining Facility and the proceeds it will receive from the shipment of lead carbonate concentrate stockpiles at the Mine. The quantum of the total funding requirement cannot be finally estimated at this time and will be contingent on the actual net proceeds received from the sale of lead carbonate concentrate stockpiles, as well as expected general market conditions at the time, including but not limited to lead prices, foreign exchange and capital markets. However, with the extension of the Facility, initial estimates indicate immediate start-up funding requirements in the range of approximately $14 to $19 million. Ivernia continues to explore a number of financing options to meet these funding requirements including a combination of debt and equity.
Wayne Richardson, a Director of Ivernia and CEO of Enirgi Group, commented "The extension of the Facility will deliver increased flexibility as the company works through financing options to underwrite the restart of operations at the Mine and further demonstrates Enirgi Group's goal of restoring value for all Ivernia shareholders. The extension reduces the initial funding requirements to restart operations at the Mine."
About Ivernia
Ivernia is an international base metal mining company and the owner of the Mine, located in Western Australia.
Ivernia trades under the symbol "IVW" on the Toronto Stock Exchange. Additional information on Ivernia is available on the Company's website at www.ivernia.com and at SEDAR at www.sedar.com.
Forward-Looking Statements
Certain statements contained in this news release constitute forward-looking information within the meaning of securities laws. All statements included herein (other than statements of historical facts) which address activities, events or developments that management anticipates will or may occur in the future are forward-looking statements, including statements as to the following: the Ivernia Board's approval, the execution of a definitive agreement and receipt of any necessary regulatory approvals with respect to the management services agreement with Enirgi Group, the direct and indirect cost savings from the service agreement with Enirgi Group, the decision to restart and timing of the restart of operations, the financing requirements to restart the Mine, the cost and timing for completion of capital projects prior to restart, the timing of any steps required under the Operating Conditions before the end of the suspension of the Company's transportation of lead carbonate from the Mine, the Company's ability to comply with the new Operating Conditions, the duration of the period of care and maintenance commenced in April 2011 and the commencement of transportation of lead carbonate concentrate from the Mine, future targets and estimates for production, capital expenditures, operating costs, cash costs, mineral resources, mineral reserves, life of mine, recovery rates, grades and prices, business strategies and measures to implement such strategies, competitive strengths, estimated goals and plans for Ivernia's future business operations, lead market outlook and other such matters. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "contemplate", "target", "believe", "plan", "estimate", "expect", and "intend" and statements that an event or result "may", "will", "can", "should", "could" or "might" occur or be achieved and other similar expressions.
These statements are based upon certain reasonable factors, assumptions and analyses made by management in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. However, whether actual results and developments will conform with management's expectations is subject to a number of risks and uncertainties, including factors underlying management's assumptions, such as, the duration of the suspension of the Company's transportation of lead carbonate from the Mine, the duration of the period of care and maintenance commenced in April 2011, the timing, need and ability to raise additional financing, risks relating to the operations being placed on care and maintenance, matters relating the restart of mining and milling operations, matters relating to ramping up mining and milling throughput and operations, regulatory compliance and approvals, metal price volatility, lead carbonate concentrate treatment charges, exchange rates, regulatory proceedings and litigation, the fact that the Company has a single mineral property, resources and reserves, health and safety, environmental factors, mining risks, metallurgy, labour and employment regulations, government regulations, insurance, dependence on key personnel, constraints on cash flow, the nature of mineral exploration and development, matters relating generally to the transportation of lead carbonate, presence of a majority shareholder, matters related to public opinion, matters related to the Esperance settlement and shipments through the Port of Fremantle, and common share price volatility and the dilution of the Company's common shares. Additional factors and considerations are discussed in the Company's 2011 AIF under "Description of the Business of the Company - Risk Factors" and elsewhere in this news release and in other documents filed from time to time by Ivernia with Canadian securities regulatory authorities. While Ivernia considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. These factors may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and there can be no assurance that the actual results or developments anticipated by management will be realized or, even if substantially realized, that they will have the expected results on the Company. Undue importance should not be placed on forward-looking information nor should reliance be placed upon this information as of any other date. Except as required by law, while it may elect to, Ivernia is under no obligation and does not undertake to update this information at any particular time.
Contacts:
Ivernia Inc.
Brent Omland
Vice President, Finance & Chief Financial Officer
(416) 867-9298
investor@ivernia.ca
www.ivernia.com
