Imperial Reports Extension for Completion Test Under Senior Credit Facility, Closing of $30 Million Line of Credit Facility and Update on Intended Financing

VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 29, 2015) -

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Imperial Metals Corporation (TSX:III) reports that its Senior Credit Facility lenders have extended the date for the Company to achieve completion at the Red Chris mine from June 1, 2015 to July 15, 2015, while they review a request to grant a further extension.

On May 19, 2015 the Company announced a $30 million line of credit ("LOC") from Edco Capital Corporation ("Edco"), a company controlled by Mr. N. Murray Edwards, a significant shareholder of the Company. This transaction has now closed with the Company receiving the $30 million proceeds. A commitment fee of $300,000 was paid in respect of the LOC. The LOC bears interest at 12% per annum and is repayable on the earlier of the date of receipt of the proceeds from the financing as detailed below or November 29, 2015.

On May 19, 2015 the Company also announced its intention to conduct a rights offering financing for gross proceeds of approximately $80 million, subject to definitive terms and conditions and required approvals from the Toronto Stock Exchange ("TSX") and securities regulatory authorities. The Company has determined, following additional review, to revise the terms of the proposed offering to comprise two tranches as follows:

1. an offer to shareholders, and, subject to applicable securities regulatory and TSX approvals, debentureholders and warrantholders ("Rightholders") rights to subscribe for $50 million of common shares of the Company at a price to be determined in the context of the market at the time of the offering (the "Rights Offering"); and
2. a concurrent issuance by way of private placement of $30 million aggregate principal amount of new convertible debentures (the "Convertible Debentures") the terms of which will be determined in the context of the market.

As announced, Edco, its affiliates, and the Fairholme Partnership, LP ("Fairholme"), significant Rightholders, subject to definitive terms and conditions and required approvals from the TSX and securities regulators, are expected to subscribe for their proportionate share of the Rights Offering, and, in exchange for a fee of 3% of the subscription proceeds in respect of all rights not owned by them, back stop the Rights Offering such that they will purchase all the common shares not otherwise purchased pursuant to the exercise of rights by other Rightholders. Edco and Fairholme are also expected to subscribe for, in aggregate, 75% of the Convertible Debenture financing, and, in exchange for a fee of 3% of the gross proceeds in respect of the remaining 25% of the Convertible Debentures to be issued, back stop the Convertible Debenture financing such that they will purchase all the Convertible Debentures not otherwise purchased by other parties offered participation in the Convertible Debenture financing.