VANCOUVER, British Columbia -- (Business Wire)
Telson Mining Corporation (“Telson” or the “Company”) (TSX-V – TSN, OTC
Pink – SOHFF, Frankfurt – TSGN (formerly SQ82)) is pleased to announce
that on June 6, 2018 it paid US$8 million to Nyrstar Mining Ltd.
(“Nyrstar”) as a partial payment under its Share Purchase Agreement
dated April 27, 2017 (the “Acquisition Agreement”) and has entered into
a Loan Agreement dated June 13, 2018 with Nyrstar Canada (Holdings) Ltd
(“the Lender”) that effectively converts the final US$8.5 million due
under the Acquisition Agreement into a loan and thereby extends the
payment terms over the next eight months.
The principal sum due under the loan agreement is US$8.5 million (the
“Principal Sum”), and will bear interest at 10% per annum, with the
Principal Sum plus capitalized amounts to be paid in full at the latest
by February 28, 2019 as more particularly described below. Telson may
prepay any amount of the loan outstanding without penalty.
On the 13th day of each month starting as of July 13, 2018
Telson will repay to the Lender:
-
a minimum of US$1,000,000; plus
-
interest at the specified rate on the outstanding Principal Sum at
that month; plus
-
70% of the monthly free cash flow generated by Telson; plus
-
any monthly excess cash balance above US$500,000.
Telson was able to make the partial payment of US$8 million from
proceeds of concentrate sales recently received from Trafigura Mexico SA
de CV (“Trafigura”). Telson will provide additional information
respecting the bulk payment from Trafigura shortly.
Sr. Jose Antonio Berlanga, Telson’s CEO stated: “We would like to thank
Nyrstar for their good faith negotiations, continued support and
cooperation in reaching a mutually agreeable extension and loan
agreement. By renegotiating and extending the final payment terms for
the Campo Morado acquisition we are extremely pleased to once again
protect our shareholders by avoiding the immediate need to raise equity
funding in what we consider an undervalued market. With the recent
declaration of Commercial Production at Campo Morado we are very
confident our free cash flows will easily support the loan repayment
terms.”
About Telson Mining Corporation
Telson Mining Corporation is a Canadian based mining company with two
Mexican gold, silver and base metal mining projects.
Telson is currently in commercial production at its 100% owned Campo
Morado Mine in Guerrero, Mexico. Telson acquired Campo Morado in June
2017, re-commenced mining and processing operations in October 2017 with
pre-production from mine development on a trial basis that commenced at
an average 1,400 tonnes per day and declared commercial production as of
May 15, 2018.
Telson's Tahuehueto Project, located in north-western Durango State,
Mexico is currently in pre-production at approximately 100 tonnes per
day utilizing a toll mill for processing, and has entered a construction
phase with a timeline to be producing on site in its own mineral
processing plant capable of milling at least 1,000 tonnes per day in Q1,
2019. Regular metal concentrate delivery and sales are underway from
both projects.
Visit: www.telsonmining.com
On behalf of the board of directors
(signed) “Ralph Shearing”
Ralph Shearing, P.Geol, President and Director
Qualified Persons
This press release was prepared under the
supervision and review of Ralph Shearing, P.Geol., President and
Director of Telson Resources Inc., a Professional Geologist registered
in Alberta as a member of the professional association APEGA, and a
Qualified Person as defined by NI 43-101.
Cautionary Note Regarding Production Decisions and Forward-Looking
Statements
It should be noted that Telson has declared
commercial production at Campo Morado prior to completing a feasibility
study of mineral reserves demonstrating economic and technical viability.Accordingly, readers should be cautioned that Telson’s production
decision has been made without a comprehensive feasibility study of
established reserves such that there is greater risk and uncertainty as
to future economic results from the Campo Morado mine and a higher
technical risk of failure than would be the case if a feasibility study
was completed and relied upon to make a production decision.Telson
has completed a preliminary economic assessment (“PEA”) mining study on
the Campo Morado mine that provides a conceptual life of mine plan and a
preliminary economic analysis based on the previously identified mineral
resources (see News Release dated November 8, 2017 and April 4, 2018).This will soon be replaced by a pre-feasibility study (“PFS”) that
will allow the application of modifying factors to the mineral resources
to allow a portion of them to be converted to mineral reserves.
Statements contained in this news release that are not historical
facts are “forward-looking information” or “forward-looking statements”
(collectively, “Forward-Looking Information”) within the meaning of
applicable Canadian securities laws. Forward Looking Information
includes, but is not limited to, disclosure regarding possible events,
conditions or financial performance that is based on assumptions about
future economic conditions and courses of action; the timing and costs
of future activities on the Company’s properties, such as production
rates and increases; success of exploration, development and bulk sample
processing activities and timing for processing at its own mineral
processing facility on the Tahuehueto project site. In certain cases,
Forward-Looking Information can be identified by the use of words and
phrases such as “plans”, “expects”, “scheduled”, “estimates”,
“forecasts”, “intends”, “anticipates” or variations of such words and
phrases. In preparing the Forward-Looking Information in this news
release, the Company has applied several material assumptions,
including, but not limited to, that the current exploration,
development, environmental and other objectives concerning the Campo
Morado Mine and the Tahuehueto Project can be achieved, the continuity
of the price of gold, zinc, lead and other metals, economic and
political conditions and operations. Forward-Looking Information
involves 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 Information.
There can be no assurance that Forward-Looking Information 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 Information. Except as
required by law, the Company does not assume any obligation to release
publicly any revisions to Forward-Looking Information contained in this
news release to reflect events or circumstances after the date hereof or
to reflect the occurrence of unanticipated events.
Neither 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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180613005862/en/
Contacts:
Telson Mining Corporation
Glen Sandwell
Corporate
Communications Manager
ir@telsonmining.com
Tel:
+1 (604) 684-8071
Source: Telson Mining Corporation
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