NorZinc Announces US$6 Million Bridge Loan from RCF to Fund Prairie Creek Project 2022 Work Program

VANCOUVER, BC, May 19, 2022 /CNW/ – NorZinc Ltd. (TSX: NZC) (OTCQB: NORZF) (the “Company” or “NorZinc“) is pleased to announce the signing of a $6 million (“M“), is around C$7.7Msecured loan agreement with RCF VI CAD LLC (“RCF“), the main shareholder of the Company.

logo (CNW Group/NorZinc Ltd.)

The proceeds of this investment will be used to finance the 2022 work program of the Prairie Creek project announced by the Company on May 4, 2022, which will include a 5,300 meter surface exploration drilling program to further validate geotechnical structural controls and refine mining dilution volume estimates. Viewer logging and analysis on planned drill holes will provide additional data and improve certainty, and additional metallurgical sample collection and testwork will increase the accuracy of concentrate grade and recovery predictions. for mining during the first three (3) to five (5). years.

“We value our relationship with RCF as our largest shareholder/partner and appreciate their continued support for the company’s development of the Prairie Creek Project,” mentioned Rohan HazeltonPresident and CEO of NorZinc. “We look forward to commencing the work program planned for 2022, which will establish new high-quality data that will form part of an enhanced and improved feasibility study to begin later this year.”

Ross BhappuHead of Mature Funds for RCF, said, “RCF is delighted to make this investment in NorZinc as it advances the development of the important Prairie Creek zinc project. Our team looks forward to continued collaborative efforts to complete the project for all. stakeholders.”

The Company has signed an agreement with RCF, as lender, and Canadian Zinc Corporation (the “Guarantor“), a wholly-owned subsidiary of the Company, as guarantor, under which RCF will provide US$6 million (C$7.7M) (the “The principal amount“) secured bridge loan (the “Bridging loan“), bearing an interest rate of 8% per annum. The loan is secured by the present and future personal assets of the Company and the Guarantor, having priority over all subsequent secured and unsecured creditors, excluding any mining lease in connection with the Prairie Creek project. The loan is repayable at maturity, i.e. 18 months after the closing date of the Bridge Loan (the “Due date“). The Company may prepay all or part of the RCF Loan, in whole or in part, at any time before the Maturity Date, including with the proceeds of the Rights Offering (as defined below It is provided that in the event of such repayment prior to the first anniversary of the closing of the Bridge Loan, the Company will pay to RCF the interest that would have accrued under the Bridge Loan up to the first anniversary if such repayment had not been made, unless this reimbursement is made by means of compensation for the participation of the RCF in the Rights Offering in order to maintain its pro rata interest in NorZinc and/or the right of RCF to guarantee up to 100% of the Rights Offering (in which case no compensatory interest is payable).

RCF holds approximately 48.31% of the issued and outstanding shares of the Company.

The bridge loan contains customary negative pledges and certain conditions, including the completed rights offering, and certain other conditions. [The closing of the loan and first drawdown is planned to occur upon receipt of approval of the loan from the TSX].

Under the terms of the bridge loan, the Company has agreed to complete a rights issue within 150 days of the closing of the bridge loan for an amount of at least 4 million US dollars (for a total of US$10 million when combined with the bridge loan commitment (the “Rights Offering“).

About NorZinc

NorZinc is a mine development company listed on the Toronto Stock Exchange under the symbol “NZC” and on the OTCQB under the symbol “NORZF”. NorZinc is focused on developing its 100% owned high-grade zinc-silver-lead Prairie Creek project located in the Northwest Territories.

Caution – Forward-Looking Information

This press release contains certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking statements relate to future events or future performance and reflect the expectations or beliefs of the Company’s management regarding future events. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as “intends”, “expects” or “anticipates”, or variations of such words and phrases or statements. that certain actions, events or results “may”, “could”, “should”, “would” or “potentially” or “probably” occur. Such information and statements, referred to herein as “forward-looking statements”, are not historical facts, are made as of the date of this press release and include, without limitation, statements regarding the closing and timing of the loan- relay and completion, timing, and size of the Rights Offering, use of proceeds thereof and 2022 work program.

These forward-looking statements involve numerous risks and uncertainties, and actual results may differ materially from the results suggested in the forward-looking statements. These risks and uncertainties include, among others: that the results and impacts arising from the binding agreement between the Company and RCF will differ from the Company’s expectations; changes in regional and global market trends; and the Company’s ability to complete the rights offering, complete Ausenco’s scenario analysis and obtain management plan approvals and permits necessary to construct the Pioneer Winter Road.

In making the forward-looking statements contained in this press release, the Company applied several important assumptions, including, without limitation, the assumptions regarding the benefits and impacts arising from the binding agreement between the Company and RCF will be consistent with the Company’s expectations.

Although the Company’s management has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking statements or information, there may be other factors that cause the results are not those anticipated, estimated or intended. . There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. Readers are cautioned that reliance on this information may not be appropriate for other purposes. The Company does not undertake to update any forward-looking statements, forward-looking information or financial outlook which are incorporated by reference herein, except in accordance with applicable securities laws. We seek refuge.

SOURCE NorZinc Ltd.



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