News
Nov 10, 2008Corporate Member News Release
CanGEA corporate member news release from Western GeoPower:
WESTERN GEOPOWER SECURES US$11 MILLION SECURED LOAN FACILITY
VANCOUVER, Canada, November 10, 2008, TSX Venture Exchange Trading Symbol: WGP – Western GeoPower Corp., a renewable energy company, today announced that it has entered into a US$11 million secured loan facility. Under the terms of the loan facility the initial tranche of US$2,480,000 will be available to the company upon receipt of approval of the TSX Venture Exchange for the issuance of warrants and the payment of certain lending fees and expenses. The second tranche of US$8,520,000 will be available to the company upon the later of 15 business days following the initial advance having elapsed or the date upon which all conditions precedent to that tranche have been met, including the perfection of security, the discharge of any liens other than permitted liens, payment of certain lending fees and expenses, and that no event of default then exists. Interest will be payable at a rate of 1% for the first six months, 1.25% for the second six months and 1.5% thereafter. The lender will have the right, subject to the prior approval of the TSX Venture Exchange, to elect to receive the payment of interest on the loan in the form of common shares of the company.
As partial consideration for entering into the loan facility, the company has agreed to issue 29,629,629 warrants of the company, each warrant being exercisable for a period of 24 months at a price per warrant of CDN$0.18. The warrants and underlying shares will be subject to a hold period of four months following their issuance.
The proceeds of the loan may be used for drilling, project management, development cost, plant equipment, and up to US$300,000 in monthly working capital and general corporate purposes.
The company is proceeding with the loan facility in lieu of completing additional tranches of its CDN$25 million non-brokered private placement announced August 7, 2008. The company completed CDN$10.6 million of that non-brokered private placement as announced on October 20, 2008.
