JOHANNESBURG (miningweekly.com) – Aim-listed North River announced on Tuesday that it had raised $5.6-million through the issue of new secured, conditionally convertible loan notes to financier Greenstone Resources.
The funds raised would be used, in conjunction with the company's existing cash resources, to repay the 2015 convertible loan notes issued to Greenstone in 2015.
The company also announced financing proposals to issue new shares to redeem the loan notes in full, subject to shareholder approval.
North River proposed to redeem 30% of the loan notes through conversion into new Greenstone shares and to redeem 70% of the loan notes through an open offer to all eligible shareholders.
On completion of these financing proposals, the company would have net additional working capital of about $2.5-million.
Greenstone's subscription for $5.6-million of loan notes provided the company with certainty of funding from Tuesday, without which it would need to commence drastic measures to reduce spending and more than likely enter into an insolvency process, which would lead to the loss of control over its Namib project.