Stornoway Diamond Corporation (TSX:SWY) entered into a binding financing commitment agreement for C$944 Million with Orion Co-Investments I Limited, Ressources Québec, a wholly-owned subsidiary of Investissement Québec, and the Caisse de dépôt et placement du Québec, for the construction of the Renard Diamond Project. The Agreement contains a series of financing transactions of US$360m from Orion, C$220m from RQ and C$105m from CDPQ, a marketed offering of common share subscription receipts and an equipment financing facility with Caterpillar Financial.

As quoted in the press release:

Highlights of the Financing Transactions are as follows. All US dollar (“US$”) figures converted into Canadian dollars (“C$”) assume an exchange rate of US$1.00 for C$1.10.

  • A C$427m offering of common share subscription receipts, being:
    • C$243mto be subscribed for by Orion, RQ and CDPQ by way of private placements in the amounts of US$110m, C$100m and C$22m, respectively; and
    • C$184mto be offered to the public by way of a concurrent prospectus offering in Canada led by Scotiabank, Dundee Capital Markets and RBC Capital Markets;
  • A C$275m forward sale of diamonds by way of a Streaming Agreement, being:
    • US$200m paid by Orion in connection with a 16% streaming interest; and
    • US$50m paid by CDPQ in connection with a 4% streaming interest;
  • C$155m in two debt facilities, being:
    • a C$100m Tranche “A” senior secured loan from RQ, bearing an initial interest rate of prime plus 4.75% with a ten year term; and
    • a US$50m convertible unsecured loan from Orion bearing an interest rate of 6.25% with a seven year term;
  • An additional C$48m in committed but initially unfunded cost overrun credit facilities, being:
    • a C$20m Tranche “B” senior secured loan from RQ; and
    • a C$28m unsecured non-convertible loan from CDPQ.

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