First Nickel Plans CAD$30 Million Project Loan Facility
TORONTO, ONTARIO -- (Marketwire) -- 08/25/10 -- First Nickel Inc. ('First Nickel' or the 'Company') (TSX: FNI) is pleased to announce that it has entered into an engagement letter to appoint Societe Generale (Canada Branch) ('SocGen') and Commonwealth Bank of Australia ('CBA') (together the 'Lead Arrangers') to act as exclusive lead arrangers for a senior secured project loan facility up to CAD$30 million (the 'Facility'). Any commitment by either Lead Arranger will be subject to, among other things, internal credit approval, due diligence, receipt of any government and regulatory approvals and definitive legal documentation, including the provision of a separate commitment letter.
An initial cash arrangement fee was paid to the Lead Arrangers upon signing of the engagement letter and further arrangement fees are payable to the Lead Arrangers in cash and warrants of First Nickel upon the acceptance of a commitment letter and upon the execution of the credit agreement evidencing the Facility. The engagement is also subject to a termination fee being paid to the Lead Arrangers in certain circumstances.
The proceeds of the Facility will be used to partially fund the direct and indirect development and start-up costs at the Company's Lockerby Depth Project.
Since late 2009, the Company has had extensive discussions with a number of interested lenders and the combination of SocGen and CBA was selected for their industry expertise, long history of supporting metals and mining companies and global approach to the commodities sector. The execution of this engagement letter follows a series of negotiations, mine visits, and technical due diligence that has taken place over the past months.
William Anderson, President and CEO of First Nickel, commented, 'We are very pleased to establish a relationship with two of the world's leading banks. Both banks understand our business very well, and have long-established credentials in mine finance. In view of the recent period of reduced credit availability, I view this step as an endorsement of the quality of the Lockerby Depth Project, and especially our operating team. It is a significant milestone for the Company in structuring a cornerstone financing package for its capital plan. We are working on another financing initiative which we hope to announce very soon, and which together with the Facility leads me to believe that we remain on target to begin construction of our Lockerby Depth Project in the fourth quarter of the year.'
About First Nickel
First Nickel is a Canadian mining and exploration company. Its current activities are primarily focused on the Sudbury Basin in northern Ontario, the location of the Company's redevelopment stage property (the Lockerby Mine) and two of its exploration properties. First Nickel also has exploration properties in the Timmins region of northern Ontario and the Belmont region of Eastern Ontario. First Nickel's shares are traded on the TSX under the symbol FNI.
Some of the statements contained in this news release are forward-looking statements, such as statements that describe First Nickel's future plans, intentions, objectives or goals, and specifically include but are not limited to the completion of the proposed Facility and additional financing initiatives, and the launch of the full development program on Lockerby Depth Project in the fourth quarter of the year. In certain cases, forward-looking statements can be identified by the use of words such as 'expects', 'will', 'enable', 'anticipates', 'estimated' or words of similar effect. Since forward-looking statements are not statements of historical fact and address future events, conditions and expectations, forward-looking statements inherently involve unknown risks, uncertainties, assumptions and other factors well beyond the Company's ability to control or predict. Actual results and developments may differ materially from those contemplated by such forward-looking statements depending on, among others, such key factors as negotiating and entering into definitive agreements for the Facility, completion of the Facility, fluctuating metal prices, completion of additional financing initiatives, maintaining operating and exploration teams, continued care and maintenance of the Lockerby Mine, and other factors described in the Company's most recently filed Annual Information Form under the heading 'Risk Factors' which has been filed electronically by means of the System for Electronic Document Analysis and Retrieval ('SEDAR') located at www.sedar.com. The forward-looking statements included in this document represent First Nickel's views as of the date of this document and subsequent events and developments may cause First Nickel's views to change. These forward-looking statements should not be relied upon as representing First Nickel's views as of any date subsequent to the date of this document. Although First Nickel has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on any forward-looking statements.
Contacts:
First Nickel Inc.
William Anderson
President & CEO
(416) 362-7050
(416) 362-9050 (FAX)
wanderson@firstnickel.com