Nevada Copper Announces $97 Million Bought Deal Public Offering; And Proposed Retirement of Convertible Debt - Seite 2

As part of the Offering, the Company is pleased to announce that it intends to prepay in full (including all accrued interest and fees thereon of approximately US$4 million) the existing US$30 million convertible loan facility that the Company entered into with Pala, the Company’s largest shareholder, on March 27, 2020 (the “Convertible Loan”) on the closing date of the Offering. The Convertible Loan was entered into as part of the Company’s balance street strengthening package that was completed in March 2020. Subsequently, Pala syndicated a portion of the Convertible Loan, including an aggregate principal amount of US$13.4 million to an affiliate of Castlelake, L.P (“Castlelake”), the Company’s second largest shareholder. In connection with the prepayment of the Convertible Loan, Pala and Castlelake have agreed to waive the applicable prepayment premiums and have agreed to subscribe for an aggregate of 302,977,529 Units for aggregate gross proceeds of approximately $45.4 million pursuant to the Offering. In addition, Pala and Castlelake have committed to subscribe for up to an additional 163,128,000 Units pursuant to the Offering for approximately $24.5 million of gross proceeds in the aggregate.

H.C. Wainwright & Co. and Jett Capital Advisors are acting as financial advisors on the Offering.

Corporate Governance

The board of directors (the “Board”) of Nevada Copper formed a special committee (the “Special Committee”) consisting of members of the Board who are independent of Pala and Castlelake, to consider the proposed terms of the Offering involving Pala and Castlelake, including the prepayment of the Convertible Loan, the repayment of the short-term financing provided by Pala and the additional subscriptions under the Offering by Pala and Castlelake. The Special Committee has met separately from the full Board. After careful consideration, the Special Committee unanimously recommended that the Company approve the terms of the Offering relating to these matters.

The involvement of Pala and Castlelake in the transactions referred to above in connection with the Offering are “related party transactions” within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101”) and the Company is relying on the exemptions in sections 5.5(g) and 5.7(e) of MI 61-101 in connection with such transactions.