Chieftain Metals Announces Amendment to Bridge Loan
TORONTO, ONTARIO--(Marketwired - Mar 31, 2015) - Chieftain Metals Corp. ("Chieftain") (TSX VENTURE:CFB) announces that its wholly-owned subsidiary Chieftain Metals Inc. (the "Company") and West Face Capital Inc., acting as agent for West Face Long Term Opportunities Global Master L.P., a fund managed by West Face Capital (collectively, "West Face Capital"), have agreed to amend the terms of the existing secured loan agreement entered into on July 4, 2014 among the Company, as borrower, Chieftain, as guarantor and West Face Capital, as agent and lender (the "Bridge Loan").
Under the amendment, the parties agree to defer all interest payments otherwise due on the Bridge Loan until March 31, 2016. During the deferral period, the Company will continue to accrue the regularly scheduled payments. The accrued interest will become payable on March 31, 2016 and amendment fees will be paid in the amounts of $150,000 on March 31, 2015 and $200,000 on March 31, 2016. The Bridge Loan has also been amended to provide that the loans made thereunder will mature and be due and payable in full on the earlier of (a) 21 calendar days after demand by West Face Capital or (b) July 4, 2016. The amendment to the Bridge Loan will be available for review on Chieftain's SEDAR profile at www.sedar.com.
Because West Face Capital is an "insider" of Chieftain as defined under applicable securities laws, the amendment to the Bridge Loan was a "related party transaction". A formal valuation was not required as a result of the nature of the related party transaction. Chieftain was also not required to obtain minority shareholder approval as a result of an applicable exemption. The board of directors of the Company considered it to be in the best interests of the Company to amend the terms of the Bridge Loan in order to provide the Company with the benefits of deferring interest payments. The interest deferral will provide Chieftain with sufficient time to advance and conclude debt and equity project financing discussions as well as continue strategic initiatives.
About West Face Capital Inc.
West Face Capital is one of Canada's leading alternative investment managers and is active in a wide range of strategies, including providing bespoke capital solutions to companies with unique opportunities. West Face Capital's capabilities are underpinned by a seasoned multi-disciplinary investment team, proprietary origination channels and deep sector expertise, both domestically and internationally.
About Chieftain Metals Corp.
Chieftain Metals Corp. is a public company whose principal business is the acquisition, exploration and development of mineral properties. Chieftain's business has focused on the development of the Tulsequah Chief deposit located in north-western British Columbia, Canada. Chieftain's properties consist of 62 mineral claims and crown-grants covering approximately 32,671 hectares including two previously producing mines.
Cautionary Statement Regarding Forward-Looking Information
This news release contains forward-looking statements, including without limitation statements with respect to the timing of payments of amounts owing under the Bridge Loan (as amended) and the accounting treatment thereof. All statements, other than statements of historical fact, are forward-looking statements and can be identified by the use of future-oriented words and phrases including without limitation "may", "will", "could", "would", "subject to", "expects" and similar words and their negative variations thereof. Forward-looking statements in this press release are based on the reasonable beliefs, estimates and opinions of Chieftain's management on the date the statements are made and address activities, events or developments that the management of Chieftain expects or anticipates will or may occur in the future, including without limitation assumptions regarding Chieftain's ability to repay amounts owing under the Bridge Loan as such amounts become due using proceeds of a subsequent financing (including project financing in respect of Chieftain's Tulsequah Project) or otherwise refinance the Bridge Loan at a future date. Forward-looking statements involve a number of risks and uncertainties both known and unknown including, with respect to the forward-looking statements made herein, risks relating to Chieftain's ability to refinance or repay amounts owing under the Bridge Loan as such become due, whether as a result of a lack of financing available on acceptable terms, fluctuations in interest rate or other factors. Consequently, there can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Chieftain does not intend to publicly update any forward-looking statements, whether as a result of new information or otherwise, except as may be required under applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release).
Contact
Chieftain Metals Corp.
Victor Wyprysky
President & CEO
(416) 479-5411
vw@chieftainmetals.com
Chieftain Metals Corp.
Pompeyo Gallardo
Chief Financial Officer
(416) 479-5412
pg@chieftainmetals.com