Largo Resources Announces Execution of New Brazilian Bank Facility and Restructuring of Existing Facilities

- December 28th, 2016

Largo Resources (TSXV:LGO) has announced that further to its press release dated December 8, 2016, Largo and Vanadio de Maracas SA, the company’s subsidiary, have entered into definitive agreements with three of its commercial banks in Brazil for a new debt facility. As quoted in the press release: The terms of the 2017 Facility, consistent … Continued

Largo Resources (TSXV:LGO) has announced that further to its press release dated December 8, 2016, Largo and Vanadio de Maracas SA, the company’s subsidiary, have entered into definitive agreements with three of its commercial banks in Brazil for a new debt facility.
As quoted in the press release:

The terms of the 2017 Facility, consistent with the previously announced binding term sheet with the Lenders, include:

  • Working capital facility of up to R$140,000,000 (Brazilian reais), granted by the Lenders
  • The 2017 Facility will be used for the payment of principal and interest falling due during 2017 on the existing loan from the Brazilian Development Bank (“the “BNDES Loan”), as well as principal and interest falling due during 2017 on existing debt facilities from certain banks within the group of Lenders.
  • The grace period for the amortization of principal of the 2017 Facility will be from the initial disbursement date thereof to March 29, 2018.
  • Principal and interest payments on the 2017 Facility becomes payable on a quarterly basis, in arrears, starting on March 30, 2018, over a period of 56 months.
  • The 2017 Facility has an applicable interest rate equivalent to the Brazilian interbank rate (the “CDI Rate”) plus 5.7% per annum.
  • The final maturity date of the 2017 Facility will be 72 months after the initial disbursement date

The Facility Documents contain certain conditions precedent by the Company prior to funding, including, injecting an additional US$15,000,000 for on-going working capital requirements at the Maracás Menchen Mine prior to January 10, 2017 (extended from December 31, 2016). The Company is thereafter also obligated to inject an additional US$5,000,000, prior to June 30, 2017. Largo anticipates that the process will be concluded prior to the disbursement date (estimated to occur on or about January 12, 2017).

Click here to read the full press release.

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