Hudson Resources Closes Debt Restructuring and Capital Injection Transaction and Recommences Operations at White Mountain MINE IN Greenland
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FOR IMMEDIATE RELEASE TSX-V: HUD
September 23, 2020 OTC: HUDRF
NR2020-10
HUDSON RESOURCES CLOSES DEBT RESTRUCTURING AND CAPITAL
INJECTION TRANSACTION AND RECOMMENCES OPERATIONS AT WHITE
MOUNTAIN MINE IN GREENLAND
Vancouver, BC – HUDSON RESOURCES INC. (“Hudson” or the “Company”) (TSX Venture Exchange
“HUD”; OTC “HUDRF”) is pleased to announce that, further to its news release s of June 11, 2020
and August 4, 2020, the Company has closed its debt restructuring transaction (the “Transaction”)
with its existing lenders, Cordiant Capital Inc. and its affiliates, and Romeo Fund – Flexi and its
affiliates (together, the “ Lenders”) after receiving shareholder approval and approval from the
Government of Greenland.
Pursuant to the Transaction, the Company, among other things, cancelled the inter-company debt
owed by the Company's subsidiary, Hudson Greenland A/S ("Hudson Greenland'), to the Company
and converted approximately US$13.7M, of the existing debt of US $43M owed to the Lenders
pursuant to existing loan facilities, into preferred shares of Hudson Greenland, thereby reducing
the Company’s interest payments substantially. Hudson Greenland also issued a conve rtible
debenture in the amount of US$10M (the “Debenture”) to the Lenders, to provide funding directly
into Hudson Greenland to ensure sufficient working capital to get the White Mountain anorthosite
mine back into operation . The Debenture has a maturity d ate of five years from the date of
issuance, and will be convertible into preferred shares in the capital of Hudson Greenland. The
Debenture will not bear interest and will not confer voting rights on the Lenders until conversion
of the Debenture, in accordance with its terms.
Hudson Greenland will use the proceeds of the Debenture for working capital to put the White
Mountain mine back into production and general corporate purposes, as approved by Hudson
Greenland’s board of directors. The Company notes that the new structure and capital injection
does not dilute the number of shares in Hudson Resources. The Company retains the right to buy
back 100% of the White Mountain mine for the next five years.
In accordance with the policies of the TSX Venture Exchange (the “Exchange”), and as a condition
to completing the Transaction, the Company obtained written shareholder approval of more than
50% of the holders of the Company’s common shares to complete the Transaction.
The Mineral License and Safety Authority of Greenland has also approved the debt transaction as
it relates to a change of control in the license which holds the White Mountain mine.
Jim Cam bon, President commented: “We are pleased to have concluded the debt restructuring
which will allow operations at the White Mountain mine to move forward so we can ship product
to customers. The team on site has re commenced operations and we have already shipped a 28
tonne sample which will be utilized for commercial trials for potential paints and coatings
customers in North America and Europe.”
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The Company now owns approximately 31% of the White Mountain anorthosite mine through its
subsidiary, Hudson Greenland A/S. This percentage may decrease to approximately 21% should
the Debenture be converted into preferred shares of Hudson Greenland.
The Company also holds the Sarfartoq rare earth element (REE) and niobium/tantalum exploration
license in Greenland. Activities have commenced on the high -grade niobium project which the
Company will provide an update on shortly.
ON BEHALF OF THE BOARD OF DIRECTORS
“Jim Cambon”
President and Director
For further information:
Ph: 604-628-5002
Forward-Looking Statements
This news release includes certain forward-looking statements or information. All statements other than statements of historical
fact included in this news release, including, without limitation, statements regarding the Company’s anticipated use of proceeds
of the Debenture and other future plans and objectives of the Company , are forward-looking statements that involve various
risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and futu re
events could differ materially from those anticipated in such statements. I mportant factors that could cause actual results to
differ materially from the Company’s plans or expectations include market prices, general economic, market or business
conditions, regulatory changes, timeliness of government or regulatory approvals and other risks detailed herein and from time
to time in the filings made by the Company with securities regulators. The Company expressly disclaims any intention or
obligation to update or revise any forward- looking statements whether as a result of new information, future events or otherwise
except as otherwise required by applicable securities legislation.
Neither the 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.