It was announced yesterday that Three Valley Copper Corp (TSXV:TVC) has entered into an undertaking between itself and its secured lenders of Minera Tres Valles, the Company’s primary asset that is 91.1% owned and located near Salamanca, Region de Coquimbo, Chile.
The company, with its direct and indirect wholly-owned subsidiaries including MTV and the lenders, have agreed to create a definitive binding agreement to revise the loan repayment schedule as set forth in the loan facility agreement.
Michael Staresinic, President and CEO of Three Valley Copper, said in a press release: “Our senior lenders continue to work as partners with us. This is an important first step in restructuring MTV’s debt obligations to improve cash flow from MTV in 2022 as we complete the development of the Papomono mine and ramp up production in 2022. Papomono is nearing completion and we remain on schedule to complete our first caving of ore in January 2022.”
Terms and conditions of the undertaking include the lenders agreeing not to accelerate or enforce their rights or remedies under the Facility Agreement if MTV were to fail to make scheduled loan repayments on March 31, 2022, June 30, 2022 and September 30, 2022 and/or replenish the operating reserve account to reestablish the Minimum Reserve as required under the Facility Agreement.
Also included in the conditions, the proceeds of the recently announced bought-deal financing of C$16 million will not be used to repay any of the loans outstanding under the Facility Agreement during the Forbearance Period. The Forbearance period is from November 22, 2021, to October 1, 2022. That financing was upsized from C$10 million after significant investor interest was expressed.
This undertaking follows the recent announcement to increase the size of the previously announced bought deal financing to an aggregate of 50,000,000 units of the Company at a price of C$0.32 per Unit. This is an excellent step forward with TVC’s partners and helps to secure financing that is expected to close later this week.