CONVERSION RIGHTS WAIVED,
US$8.5 MILLION CONVERTIBLE
DEBENTURE REPAID
VANCOUVER, BC, Dec. 2, 2020 /CNW/ - Northern Vertex Mining
Corp. (TSXV: NEE) (OTC Nasdaq Intl.: NHVCF) (the
"Company" or "Northern Vertex") is pleased to announce that it
has repaid in full on the maturity date of December 1, 2020 (the "Maturity Date") the
principal amount of US$8,500,000 (the
"Principal Amount"), together with all accrued and unpaid
interest payable thereunder, of the unsecured subordinated
convertible debenture (the "Debenture") of the Company held
by Greenstone Resources II L.P. ("Greenstone"), the terms of
which are as described in the Company's press releases dated
October 3, 2019 and October 11, 2019.
Ken Berry, CEO of Northern
Vertex stated: "On the back of our first quarter's record
production and revenue, I am delighted to strengthen our balance
sheet in a manner that minimizes dilution to all
shareholders. The Greenstone Debenture has been repaid in
full. Greenstone agreed to receive a cash repayment and waive
its conversion rights under the Debenture for an additional
US$2 million structured cash payment.
Our closing price yesterday on the TSXV was C$0.62, more than 100% above the C$0.30 conversion price of the US$8.5 million Debenture. This transaction
saves our shareholders the dilution of approximately 37,000,000
shares (15% of issued) had the C$0.30
conversion rights been exercised in full."
In accordance with the terms of the Debenture, all or part of
the Principal Amount was convertible into common shares of Northern
Vertex at a price of C$0.30 per
common share, at the sole election of Greenstone, at any time and
from time to time from until the Maturity Date (the "Conversion
Right"). Northern Vertex and Greenstone have entered into
an agreement pursuant to which Greenstone has agreed not to
exercise, and to waive in full, the Conversion Right (the
"Waiver of the Conversion Right") in consideration for a
cash payment of US$2,000,000 from
Northern Vertex to Greenstone, with such payment to be made on the
earlier of the satisfaction by the Company of certain conditions
precedent or the date that is six months following the original
Maturity Date.
The Waiver of the Conversion right is subject to the final
acceptance of the TSX Venture Exchange and is a related party
transaction pursuant to Multilateral Instrument 61-101 –
Protection of Minority Security Holders in Special Transactions
("MI 61-101"), as Greenstone currently holds approximately
31% of the current issued and outstanding common shares of the
Company. The Waiver of the Conversion Right is exempt from
the requirement to obtain a formal valuation under section 5.4 of
MI 61-101, as the Company's common shares are not listed on a
senior stock exchange as set out in section 5.5(a) of MI
61-101. The Company is exempt from the requirement to obtain
minority shareholder approval of the Waiver of the Conversion Right
pursuant to section 5.6 of MI 61-101, as the fair market value of,
and the consideration for, the Waiver of the Conversion Right does
not constitute more than 25% of the Company's market capitalization
as set out in section 5.7(a) of MI 61-101. At a meeting of
the board of directors of the Company, the Board unanimously
approved the Waiver of the Conversion Right, with Michael Haworth and Ivan
Fairhall (both having a disclosable interest it the
transaction due to their relationships with Greenstone) having left
the meeting during the consideration of the Waiver of the
Conversion Right.
About Northern Vertex Mining Corp.
Northern Vertex Mining Corp. owns and operates the Moss Mine,
currently the largest pure gold and silver mine in Arizona. Focused on low cost gold and silver
production, the Company has experience across all areas of
operations, mine development, exploration, acquisitions, and
financing of mining projects. With operations at the flagship Moss
Mine achieving commercial production the Company intends to
consolidate additional producing or near-term production gold
assets within the Western US. Through mergers and acquisitions
Northern Vertex's corporate goal is to become a mid-tier gold
producer.
ON BEHALF OF THE BOARD OF NORTHERN VERTEX
"Kenneth Berry"
President & CEO
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.
Cautionary Note Regarding Forward-Looking
Statements:
This news release
contains statements about our future business and planned
activities. These are "forward-looking" because we have used what
we know and expect today to make a statement about the future.
Forward-looking statements include but are not limited to receipt
of final regulatory approval in respect of the Waiver of the
Conversion Right and comments regarding the planned uses of future
cash flows from the Moss Mine. Forward-looking statements usually
include words such as scheduled, may, intend, plan, expect,
anticipate, believe or other similar words. Forward-looking
statements are necessarily based upon a number of factors and
assumptions that, while considered reasonable by the Company as of
the date of such statements, are inherently subject to significant
business, economic and competitive uncertainties and contingencies,
including the receipt of regulatory approvals. Many factors,
known and unknown, could cause actual results to be materially
different from those expressed or implied by such forward-looking
statements. We believe the expectations reflected in these
forward-looking statements are reasonable. However, actual events
and results could be substantially different because of the risks
and uncertainties associated with our business or events that
happen after the date of this news release. Readers are cautioned
not to place undue reliance on forward-looking statements, which
speak only as of the date made. As a general policy, we do not
update forward-looking statements except as required by securities
laws and regulations. US investors should be aware that
mining terminology used for Canadian mineral project reporting
purposes differs significantly from US terminology.
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SOURCE Northern Vertex Mining Corp.
