First Bauxite Corporation has announced that it has entered into a loan with Resource Capital Fund VI L.P. for a bridge loan facility with a principal amount of up to US$5 million. The fund from the Bridge Loan would be used for the purpose of funding development initiatives related to the direct shipping operations and working capital expenses of its Bonasika Bauxite Project.
The Bridge Loan will be offered in three instalments, a first advance of up to US$2 million, which has been paid to the Company, a second advance of up to US$2 million, which is to be available on or after March 1, 2018 and a third advance of up to an amount equal to the undrawn balance, which will be available on or after April 1, 2018.
The loan will be repayable in full on the date of Event of Default that falls 12 months after the date of the First Advance. The Bridge Loan would be a solid financial support in connection with financing the Company's Bonasika Bauxite Project and the Company's bauxite mining and beneficiation plant in Guyana. The notice confirms that the Company may pay or prepay the loan in whole or in part at any time prior to the Maturity Date without penalty or premium.
First Bauxite Corporation received an approval from the Guyana Geology and Mines Commission for an extension to commence construction under its Mining License for the Bonasika Project in November 2017. The Company had earlier received an extension through January 31, 2018, which also provided for an additional year to be granted if the project makes sufficient progress to merit the additional extension.
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