Silver Bear Announces Facilities Agreement Amendments and Acquires X-Ray Transmission Ore Sorting System

TORONTO, Dec. 24, 2019 (GLOBE NEWSWIRE) -- Silver Bear Resources Plc (“Silver Bear” or the “Company”) (TSX: SBR) announces that it has amended its existing facilities agreement (the “Facilities Agreement”) with Inflection Management Corporation Limited (“Inflection”), a major shareholder of the Company, and Unifirm Limited (“Unifirm”), an affiliate of A.B. Aterra Resources Ltd. (“Aterra”), also a major shareholder of the Company. The amendments to the Facilities Agreement (the “Facilities Agreement Amendments”): (i) provide for two new term loan facility tranches of US$2 million each (“Tranche H” and “Tranche I”) for an aggregate of US$4 million, which will become due and repayable on July 31, 2021; and (ii) extend the first interest period under the Facilities Agreement and revise the interest capitalization date to January 1, 2020. Funds from Tranche H and Tranche I will be used to acquire X-Ray Transmission (“XRT”) processing equipment and for flotation line construction. The Facilities Agreement Amendments have been conditionally approved by the Toronto Stock Exchange.

Vadim Ilchuk, President and Chief Executive Officer, commented: “The addition of Tranches H and I to our existing Facilities Agreement provides the Company with the financing to add (1) the XRT processing technology to our processing line, which is expected to improve overall process plant efficiency and to lower operational costs; and (2) flotation equipment to deal with the processing of primary ore.  We would like to thank both Inflection and Aterra for their ongoing support of the Mangazeisky silver project. This new financing gives the Company the financial flexibility to further enhance the project economics and will ensure that the equipment required will be transported down the 2020 winter road. The Company expects to provide an update on the implementation of the XRT process in the first quarter of 2020.”

The Facilities Agreement Amendments are a “related party transaction” under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”) because Inflection and Aterra, an affiliate of Unifirm, are related parties to the Company, as its major shareholders. Pursuant to Section 5.7(f) of MI 61-101, the Company is exempt from obtaining approval of the Company’s minority shareholders as a result of the Facilities Agreement Amendments being an amendment to a loan to the Company (obtained from a related party on reasonable commercial terms that are not less advantageous to the Company than if such credit facility was obtained through an arm’s length lender) that has no equity or voting component. The Company will file a material change report in respect of the Facilities Agreement Amendments. However, the material change report will be filed less than 21 days prior to the implementation of the Facilities Agreement Amendments, which is consistent with market practice and the Company deems reasonable in the circumstances.