Candelaria Mining Corp (CVE:CAND) (OTCPINK:CDELF) has closed a US$9 million medium-term loan facility with Accendo Banco SA to help finance construction of its Pinos project in Mexico.
The loan is secured against Candelaria’s assets and will bear an interest rate of 13% per year with a 60-month term starting at the draw date. Candelaria may draw US$1.5 million once it executes the facility, with the balance to be made once final loan documentation is completed.
Accendo will receive a cash fee of 2% of the total facility as well as 18 million Candelaria warrants exercisable at C$0.11 per share for a 60-month period.
“Candelaria is pleased to have reached agreement with a lender such as Accendo Banco for a project loan facility,” CEO Curtis Turner said in a statement.
The announcement represents a major catalyst that provides substantial economic development for the municipality of Pinos in Zacatecas state, according to Turner.
“The facility also provides key features sought by Candelaria through its solicitation process: a simple debt instrument with limited financial covenants, including a flexible structure allowing for early drawdown and pre-payment of principal,” Turner added.
“Accendo’s in-depth knowledge of the Pinos project is expected to result in an expedited timeline to closing.”
Pinos hosts a measured resource of 4,444 ounces of gold and 228,892 ounces of silver and an indicated resource of 20,586 ounces of gold and 267,745 of ounces of silver.
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