North River Resources confirms future funding with Greenstone

North River Resources announced on Tuesday that it has conditionally raised $5.6m through the issue of new secured, conditionally convertible loan notes to Greenstone Resources.

The AIM-traded firm said the funds raised will be used, in conjunction with the company’s existing cash resources, to repay the 2015 convertible loan notes issued to Greenstone, and to provide working capital for the company’s short-term work programme and ongoing planning for commencing outstanding pre-construction work streams.

“Greenstone's subscription for $5.6m of Loan Notes provides the company with certainty of funding from today, without which it would need to commence drastic measures to reduce spending and more than likely enter into an insolvency process, which would almost certainly lead to the loss of control over the Company's principal asset, being the Namib Project,” the company’s board said in a statement.

“The loan notes subscription and the financing proposals are the only terms on which Greenstone is willing to finance the company at this stage and, whether or not the elements of the financing proposals which are subject to shareholder approval are approved, the loan notes subscription and the financing proposals secure the company's immediate financial position and provide a structure in which all shareholders are able to participate and to retain an interest in the company.”