Trading Symbols TSX - CRJ NYSE MKT - CGR
Claude Resources Inc. (TSX-CRJ; NYSE MKT-CGR) ("Claude" and or the "Company") today reported that it has expanded its current debt facilities with its existing bank, Canadian Western Bank ("CWB") and, in addition, has come to an agreement with Crown Capital Partners Inc. ("CCP") for a debt facility of $25 million.
CWB Financing Summary
The Company has expanded its current debt facilities to $25 million, of which $8.6 million is currently drawn. The current $8.6 million consists of leases, demand loans and a line of credit. The debt expansion is structured as follows:
Facility Previous Amount Current AmountLine of Credit $5,000,000 $10,000,000Leases/Demand Loans $7,000,000 $10,000,000Revolving Loan NIL $5,000,000
Interest rates are both fixed and floating and carry a weighted average rate of approximately 4.5 percent.
CCP Financing Summary
The CCP offering consists of a five (5) year $25 million debt facility which carries an interest rate of 10 percent of the outstanding principal, compounded and payable monthly. Principal payments, due to begin in 2014, are payable monthly. The facility includes 5.75 million warrants at a strike price of $0.70 and can be exercisable at any time from the closing of the transaction to 5 years following the closing of the transaction. The issuance of warrants is subject to approval from each of the Toronto Stock Exchange and the New York Stock Exchange. Closing of the CCP financing is subjective to customary conditions precedent.
Principal Repayment Terms
Period Monthly Amount Annual AmountMonths 1 - 12 NIL NILMonths 13 - 59 $300,000 $3,600,000Due at Maturity $10,900,000
Prepayment Terms
Months Following Closing Prepayment FeeMonths 13 - 24 2%Months 25 - 36 1%Months 37 - 60 0%
Neil McMillan, President and CEO, stated, "We are pleased to have both CWB and Crown Capital demonstrating their confidence and support of our business plan. We are satisfied with our blended cost of capital of approximately 8 percent. It represents the confidence our debt providers have in our ability to manage and retire the debt upon maturity. Our track record over the past 21 years has certainly helped us build a good relationship with CWB and Crown. The Company expects to be able to grow the Seabee Gold Operation production by 10 to 15 percent compounded annually over the next 5 years and we are happy to have CWB and Crown as partners in that growth."
Use of Proceeds
The Company believes that its new capital structure will advance the Company over the long term without penalizing shareholders through major equity financings. The new debt facilities are intended for the retirement of the $9.8 million debenture due in May 2013, for expansion capital at the Seabee Gold Operation and for general working capital purposes. The Company is confident that it can efficiently service and repay the debt facilities through growing operating cash flows from the Seabee Gold Operation.
About Claude Resources Inc.
Claude Resources Inc. is a gold producer with shares listed on both the Toronto Stock Exchange (TSX-CRJ) and the NYSE MKT (NYSE MKT-CGR).The Company is also engaged in the exploration and development of gold mineral reserves and mineral resources. The Company's entire asset base is located in Canada.Its main revenue generating asset is the 100 percent owned Seabee Gold Project, located in northern Saskatchewan. Since 1991, Claude has produced over 1,010,000 ounces of gold from the Seabee Gold Project. Claude also owns 100 percent of the Madsen property near Red Lake, Ontario and 100 percent interest in the Amisk Gold Property in northeastern Saskatchewan.
About Canadian Western Bank
Canadian Western Bank (TSX: CWB) is the largest publicly traded Canadian bank headquartered in Western Canada. CWB and its operating affiliates, which are together known as Canadian Western Bank Group, offer a diversified range of financial services through 41 banking branches, eight trust locations, two centralized insurance offices, a focused commercial equipment leasing centre and one wealth management location.
About Crown Capital Partners Inc.
Crown Capital Partners is a leading provider of growth capital to middle market companies throughout Canada. Crown Capital Partners focuses on providing specialized financing solutions including structured equity, subordinated term, and bridge loans for acquisitions, management buy-outs, growth financings and recapitalizations.