Laramide Resources Amends and Extends Credit Facility; Provides Corporate Update Listed
Laramide Resources Amends and Extends
Credit Facility; Provides Corporate Update
Listed
(TSX:LAM; ASX:LAM)
/THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN
CANADA
ONLY AND IS NOT
INTENDED FOR DISTRIBUTION TO
UNITED STATES
NEWSWIRE SERVICES OR
DISSEMINATION IN
THE UNITED STATES
./
TORONTO
,
March 27, 2020
/CNW/ -
Laramide Resources Ltd. ("
Laramide
" or the "
Company
") is
pleased to announce that the Company and its lenders, Extract Capital Master Fund Ltd. and Extract
Lending LLC (together, the "
Lenders
"), with Extract Advisors LLC acting as agent for and on behalf
of the Lenders (the "
Agent
"), completed an amendment (the "
Amendment
") to the existing term
loan made by the Lenders in favour of Laramide Resources (
USA
) Ltd. (the "
Term Loan
"), which
includes, among other things, (i) an extension of the maturity date of the Term Loan from
December
29, 2021
to
March 31, 2023
and (ii) the outstanding amounts be convertible into common shares of
the Company at a price of
C$0.40
per common share.
Pursuant to the Amendment, the Company paid an amendment fee of
C$50,000
to the Agent and
issued an aggregate of 300,000 common share purchase warrants to the Lenders with an exercise
price of
C$0.60
, each of which is exercisable for one (1) common share of the Company until
March
25, 2022
.
The Company further highlights the recent decision of the Canadian Securities Administrators (CSA)
which provides temporary blanket relief (Temporary Relief) to market participants in connection with
the filing of certain continuous disclosure and other documents due before
June 1, 2020
. This
Temporary Relief is a response by the CSA to recent COVID-19 developments which have impacted
businesses worldwide as companies try to rapidly adjust to new (hopefully temporary) operational
protocols mandated by virtually every western government. These include the governments of
Canada
,
Australia
, and
the United States
where Laramide has either project assets and/or offices.
While the Company currently expects little material impact from COVID-19 on its business or
business prospects in 2020, it has elected to avail itself of this disclosure relief and now anticipates
it will file its Annual 2019 Financial Statements and related disclosures (MD&A and AIF) in the latter
half of
April 2020
. It expects no delay to the First Quarter 2020 filings (due before
May 15, 2020
)
and also expects to hold its Annual and Special Meeting of Shareholders as previously planned in the
second quarter of 2020. This meeting is now scheduled to be held in
Toronto
on
June 16, 2020
.
In regards to recent macro developments as they pertain to Laramide's prospects and outlook for
uranium developers in general, President and CEO
Marc Henderson
had the following comments: "
A little more than a month ago, the most important development on the horizon for the uranium
sector appeared to be the positive action about to be taken by the US government to address the
survival and revitalization of domestic nuclear fuel production, of which uranium production is the
critical first step. US President Trump's "Budget for America's Future", which was announced on
February 10, 2020
, included a 10-year,
$150M
per year program (
$1.5 billion
total), to purchase
U.S. mined uranium for a strategic national Uranium Reserve. Other pro-active regulatory and other
administrative efforts were expected to follow, and to be directed at domestic production and near
production assets.
With our large US domiciled resource in late stage development projects like Churchrock,
La Sal
,
and La Jara Mesa, Laramide stood to be a beneficiary of these actions if they eventuated but the
emergence of the COVID-19 pandemic now overshadows everything and will likely (and rightly)
dominate US domestic policy considerations, both social and economic, for some time to come.
The business of nuclear power, in which uranium companies play a critical role, may paradoxically be
either unaffected by the COVID-19 issue or perhaps even be strengthened by it. The principal
reasons for this are twofold: firstly, nuclear generation is almost always the cornerstone baseload
component of nations where nuclear energy is produced; consequently, when electricity demand
contracts (as is doing now), variable energy sources like coal, natural gas and even renewables are
likely to be the first sources reduced or curtailed. This makes nuclear power (and indirectly uranium)
one of the few areas of the economy that are essentially
non GDP correlated
– at least in the short
to medium term.
Secondly, and this feeds off the undiminished near term demand picture for uranium noted above, is
that the supply side of uranium has been in a primary deficit position for many years with utilities
relying on inventories and other above ground supply to balance the market. This is clearly not a
sustainable long-term business model to power the world's nuclear reactor fleet, with current prices
nowhere near sufficient to sustain existing producers, let alone incentivize new projects like those
owned by Laramide. All market participants understood this dynamic could not last but after a
grinding nine year bear market, turnaround predictions (and predictors) have been highly devalued
and many supposed market catalysts have come and gone.
Enter COVID-19, however, which has now this week caused the world's largest uranium mine –
Cigar Lake in
Saskatchewan
– to come offline and, if others were to follow suit, the recent
complacency of utility fuel buyers with respect to security of supply is likely to be tested. We believe
uranium equity valuations – which have fallen in line with the general decline of almost all equities in
March 2020
– do not reflect the prospect that a meaningful industry recovery could finally begin in
2020."
To learn more about Laramide, please visit the Company's website at
www.laramide.com
.
About Laramide Resources:
Laramide is a Canadian-based company with diversified uranium assets strategically positioned in
the United States
and
Australia
that have been chosen for their low-cost production potential.
Laramide's recently acquired
Church Rock
and
Crownpoint
properties form a leading In-Situ
Recovery (ISR) division that benefits from significant mineral resources and near-term development
potential. Additional U.S. assets include La Jara Mesa in
Grants, New Mexico
, and
La Sal
in the
Lisbon Valley district of
Utah
. The Company's Australian advanced stage
Westmoreland
is one of
the largest uranium projects currently held by a junior mining company. Laramide is listed on the
TSX: LAM and ASX: LAM.
Forward-looking Statements and Cautionary Language
This News Release contains forward looking statements which are subject to a variety of risks and
uncertainties which could cause actual events or results to differ materially from those reflected in
the forward-looking statements. The Company does not intend to update this information and
disclaims any legal liability to the contrary.
SOURCE
Laramide Resources Ltd.
View original content:
http://www.newswire.ca/en/releases/archive/March2020/27/c9415.html
%SEDAR: 00003540E
For further information:
Marc Henderson, President and Chief Executive Officer, Toronto, Canada,
+1 (416) 599 7363; Follow us on Twitter @LaramideRes
CO: Laramide Resources Ltd.
CNW 13:08e 27-MAR-20