TSX-V-listed ScoZinc Mining and Fancamp Exploration have terminated a previously announced arrangement agreement and, instead, the companies entered into a new agreement whereby Fancamp will become a cornerstone investor in ScoZinc.
Fancamp will invest in ScoZinc by way of a C$1.3-million private placement and its loan and termination fee will be converted to equity in ScoZinc.
ScoZinc president and CEO Mark Haywood says that the investment will assist ScoZinc’s plans to finance its Scotia zinc/lead mine towards commercial production.
The Nova Scotia mine will require C$30.8-million in preproduction capital expenditure and will produce an average of 35-million pounds a year of zinc and 15-million pounds a year of lead, at an all-in sustaining cost of $0.60/lb of zinc-equivalent.
The company will subscribe to 1 969 697 shares of ScoZinc at C$0.66 a share and the termination fee of C$300 000 will be credited towards the subscription.
Regarding Fancamp’s secured C$250 000 loan to ScoZinc, ScoZinc will issue Fancamp 378 788 fully paid and non-assessable common shares at a deemed issue price of $0.66 a share.