Stornoway Diamond Corporation (TSX:SWY) entered into an unsecured non-revolving bridge credit facility of up to $20 million for its Rendard Diamond Project, with Ressources Québec. Ressources Québec is a subsidiary of Investissement Québec, Stornoway’s largest shareholder, through its indirect wholly-owned subsidiary Diaquem Inc.
As quoted in the press release:
Under the facility, the Lender will loan up to an aggregate amount of $20 million to Stornoway in two tranches, an initial tranche of $10 million which is expected to be made available on or about October 2, 2013 and a second tranche of up to $10 million, each of which will bear interest at 12% per annum and be repayable on March 28, 2014. The Lender has the discretion to determine whether to fund the second tranche and, if so, the specific amount. A commitment fee equal to 1% of the amount funded under each tranche is payable by Stornoway.
Stornoway Diamond Corporation President and CEO, Matt Manson, said:
This credit facility is intended to provide Stornoway with good funding flexibility as we pursue our project financing activities and begin the ramp-up to the capital programs anticipated at Renard in 2014 and 2015. We are particularly pleased to acknowledge the continued and constructive support of our major shareholder, Investissement Québec, in the development of this important new Québec mining project. With major regulatory authorizations in hand and the Renard Mine Road now open for construction traffic, Stornoway’s primary objective is the timely conclusion of our principal project financing arrangements.