Credit Facility
September 07, 2012 09:49 ET
Lake Shore Gold Completes C$90 Million Convertible Senior Unsecured Debenture Offering, Net Proceeds to Retire US$50 Million Credit Facility
TORONTO, ONTARIO--(Marketwire - Sept. 7, 2012) -
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.
Lake Shore Gold Corp. ("Lake Shore Gold" or the "Company") (TSX:LSG)(NYSE MKT:LSG) announced today that the Company has completed the previously announced public offering (the "Offering"), on a "bought deal" basis, of C$90 million principal amount of 6.25% convertible senior unsecured debentures (the "Debentures") maturing on September 30, 2017. The net proceeds of the Offering, totaling C$86.4 million, are being used by the Company to repay and extinguish a US$50 million three-year senior secured corporate revolving facility with UniCredit Bank AG and for general corporate purposes. The Debentures provide funding to the Company at a lower cost and longer term than is available through a currently undrawn C$35 million standby line of credit with Sprott Resource Lending Partnership.
The Offering was made through a syndicate of underwriters led by BMO Capital Markets and including CIBC World Markets Inc., National Bank Financial Inc., RBC Dominion Securities Inc. and TD Securities Inc. The Company has granted the underwriters the option to purchase up to C$13.5 million principal amount of additional Debentures at a price of C$1,000 per Debenture to cover over-allotments, exercisable in whole or in part anytime up to 30 days from today's closing of the Offering.
The Debentures, which began trading at today's opening on the Toronto Stock Exchange ("TSX") under the symbol LSG.DB, are convertible at the holder's option into common shares of the Company at a conversion price of C$1.40 per common share. The Debentures are not redeemable prior to September 30, 2015. On and after September 30, 2015 and prior to maturity, the Debentures may be redeemed in whole or in part from time to time at the Company's option, at a price equal to their principal amount plus accrued and unpaid interest, provided that the volume weighted average trading price of the common shares on the TSX for the 20 consecutive trading days preceding the date on which the notice of redemption is given is not less than 130% of the conversion price.
Further details of the Offering are provided in the short-form prospectus dated August 30, 2012 and filed on sedar at www.sedar.com.
The Debentures have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.