CONTINENTAL GOLD BACKED BY NEWMONT MINING AND TRIPLE FLAG CONTINENTAL GOLD ANNOUNCES FULLY SUBSCRIBED US$175 MILLION FINANCING PACKAGE BACKED BY NEWMONT MINING AND TRIPLE FLAG
Continental Gold Inc. has obtained a $175-million (U.S.) financing package consisting of (i) $75-million (U.S.) of unsecured convertible debentures being issued to certain investors, including a $50-million (U.S.) debenture from Newmont Mining Corp., and (ii) a $100-million (U.S.) gold and silver stream from Triple Flag Mining Finance Bermuda Ltd. Proceeds from the Financing Package will be used for general and working capital purposes and toward construction, commissioning and start-up of the Company's Buritica Project located in Antioquia, Colombia. The Company has also agreed with RK Mine Finance to make certain amendments to its existing credit agreement in respect of the security documents in connection with the Stream.
Financing Package
Unsecured Convertible Debenture
Aggregate US$75 million unsecured 5-year and 2-month Debentures with a 5% interest rate payable semi-annually in arrears.
Each of the Debentures will be convertible at the holder's option into common shares of the Company (the "Shares") at a conversion price of C$3.00 per Share (the "Conversion Price"), representing a 27.1% premium to the 30-day volume weighted average share price ("VWAP") on the Toronto Stock Exchange ("TSX"). Assuming full conversion of the Debenture issued to Newmont only, Newmont's ownership in the Company would increase to approximately 28%.
Each of the Debenture holders agree not to engage in any short sales or other similar transactions with respect to all aspects of the Debenture.
The Company has the option to redeem all, but not less than all, of the Debentures, at a redemption price equal to 100% of the principal amount then outstanding, plus all accrued and unpaid interest, if the closing price of the Shares on the TSX is at least 130% of the Conversion Price for each of the 20 trading days before a notice of redemption is delivered to the holders, subject to the terms of the Debentures (including the right of holders to convert prior to redemption).
Gold and Silver Stream
US$100 million subordinated secured 2.1% gold and 100% silver stream on the Buritica Project, where payable silver is deemed to be 1.84 ounces of payable silver for each ounce of payable gold.
Ongoing payments of 10% and 5% of the spot price of gold and silver, respectively.
Full buyback option, on or before December 31, 2021, of the entire gold stream for US$80 million, less any gold stream net cash flows received as at the time of buyback.
Closing and funding of the Stream deposit is subject to customary closing conditions.
Maxit Capital acted as financial adviser to Continental Gold with respect to the Stream transaction.
About Continental Gold
Continental Gold Inc. is an advanced-stage exploration and development company with an extensive portfolio of 100%-owned gold projects in Colombia. Formed in April 2007, the Company - led by an international management team with a successful track record of discovering and developing large high-grade gold deposits in Latin America - is focused on advancing its fully-permitted high-grade Buritica gold project to production with first gold pour on track for early 2020.