Team,
I am pleased to confirm that pricing was completed today for Torchlight Mining Corp.'s offering of $300,000,000 aggregate principal amount of 8.750% Senior Secured Notes due 2029, with Kelvantis Capital Markets LLC acting as lead book-running manager. The offering is being conducted pursuant to Rule 144A and Regulation S under the Securities Act. A Pricing Term Sheet Summary is attached for the deal team's reference.
The confirmed pricing terms are set forth below.
**PRICING TERMS SUMMARY**
Issuer: Torchlight Mining Corp. Guarantors: Wolverine Lake Mining Ltd.; Torchlight Milling & Processing Inc.; Torchlight U.S. Holdings, Inc. Security: 8.750% Senior Secured Notes due 2029 Aggregate Principal Amount: $300,000,000 Coupon: 8.750% per annum, payable semi-annually on April 15 and October 15 of each year First Interest Payment Date: October 15, 2022 Maturity Date: April 15, 2029 Issue Price: 98.50% of par (gross proceeds of $295,500,000) OID: 1.50% ($4,500,000) Minimum Denomination: $2,000 and integral multiples of $1,000 in excess thereof Offering Type: Rule 144A / Regulation S Governing Law: New York Collateral: First-priority lien on substantially all assets of the Issuer and Guarantors Ratings: Northmark Ratings Group, Inc. — B1 (stable outlook); Creston Analytics, Inc. — B+ (stable outlook)
**CUSIP / ISIN ASSIGNMENTS**
144A: CUSIP: 891207 AA 3 ISIN: US891207AA38
Reg S: CUSIP: C89120 AA 5 ISIN: USC89120AA58
**INITIAL PURCHASER DISCOUNT AND ALLOCATION**
Initial Purchaser discount: 2.25% of aggregate principal amount = $6,750,000
Allocation: Kelvantis Capital Markets LLC (lead book-runner) — 60% — $4,050,000 Prestige Barrington & Co., Inc. (co-manager) — 25% — $1,687,500 Halcyon Securities Inc. (co-manager) — 15% — $1,012,500
**SETTLEMENT / BOOK-ENTRY**
The Notes will be issued in book-entry form through DTC (144A tranche) and Thackeray Partners LLC/Ashgrove Enterprises (Regulation S tranche). Northern Dominion Trust Company will serve as Indenture Trustee, Collateral Agent, Paying Agent, Transfer Agent, and Registrar.
**OPTIONAL REDEMPTION HIGHLIGHTS**
Make-whole at T + 50 bps prior to April 15, 2025 Equity clawback at 108.750% (up to 40% of original aggregate principal amount) prior to April 15, 2025 104.375% on or after April 15, 2025 102.188% on or after April 15, 2026 100.000% on or after April 15, 2027
**USE OF PROCEEDS**
Phase II Wolverine Lake mine expansion CapEx: $167,000,000 Ridgeline Bank of Canada revolving facility payoff: $110,250,000 Transaction fees and expenses: $14,250,000 General corporate purposes and working capital: $8,500,000
**NEXT STEPS AND TIMELINE**
Execution of the Purchase Agreement is targeted for Tuesday, March 29, 2022 (Signing Date). Expected closing is April 5, 2022 (T+3 settlement), subject to satisfaction of all conditions precedent and regulatory clearances. C&H and Clairmont & Voss will circulate the execution version of the Purchase Agreement for the deal team's review over the coming days.
As a reminder, closing deliverables — including legal opinions, officers' certificates, the payoff letter from Ridgeline Bank of Canada, and the funds flow memorandum — should be advanced in parallel. In connection with the closing, the Ridgeline Bank of Canada CAD $225,000,000 revolving credit facility (CAD $140,000,000 currently drawn) is to be repaid in full and terminated; the payoff amount in USD is $110,250,000 (based on a USD/CAD exchange rate of 0.7875).
Please do not hesitate to reach out with any questions or comments. We are available over the weekend to continue advancing the signing documentation.
Congratulations to the full team on a successful pricing.
Best regards,
Audrey Zhou Lead Associate, Capital Markets Calderwood & Harkness LLP 450 Park Avenue New York, NY 10022 D: +1 (212) 506-3847 azhou@calderwoodharkness.com Matter No. 1039-00002
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