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Mudrick Capital Acquisition Acquires Hycroft Mining to Form Publicly Traded Hycroft Mining Holding
Monday 01 June 2020

US-based blank check company Mudrick Capital acquisition Corp. (NASDAQ: MUDS) (NASDAQ: MUDSU) (NASDAQ: MUDSW) has acquired Nevada-based gold and silver producer Hycroft Mining Corp. to create mining company Hycroft Mining Holding Corp. (NASDAQ: HYMC), the company said.

The shareholders of each of MUDS and Hycroft approved the transaction, which closed on May 29, 2020.

Hycroft has sold all of the equity interests of Hycroft's subsidiaries and substantially all of its other assets to MUDS, and MUDS has discharged and paid or assumed all or substantially all of Hycroft's liabilities.

HYMC has 50.2m common shares outstanding, as of the consummation of the transaction.

HYMC has in excess of USD 50m of unrestricted cash on hand post transaction. Cash sources for the transaction included a USD 110m multi-tranche senior secured credit facility by Sprott Private Resource Lending II LP, of which USD 70m was drawn at closing, a USD 30m 1.5% net smelter royalty agreement arranged by Sprott Private Resource Lending II Inc., a USD 25m forward purchase of HYMC's units and shares by Mudrick Capital acquisition Holdings LLC, a USD 75.96m purchase of HYMC shares by certain stockholders of Hycroft and the net cash of USD 12.4m remaining in HYMC's trust account following stockholder redemptions.

HYMC's post-transaction indebtedness will include amounts drawn from the Senior Credit Facility plus newly issued subordinated notes totaling USD 80m.

All other indebtedness of Hycroft was retired, exchanged for MUDS shares or converted into Hycroft shares. The Hycroft stockholders were distributed shares of HYMC upon the dissolution of Hycroft.

Neal, Gerber and Eisenberg LLP is acting as legal advisor to Hycroft and will act as legal counsel to HYMC. Weil, Gotshal and Manges LLP is acting as legal advisor to MUDS.

Hycroft Mining Holding Corp. is a US-based, gold and silver producer operating the Hycroft mine, which features one of the largest gold/silver deposits in the world with a low-capital, low-cost process and a 34-year mine life.
Date Published: 01/06/2020