VANCOUVER, Aug. 11, 2016 /CNW/ - Goldgroup Mining Inc.
("Goldgroup" or the "Company") (TSX:GGA, OTC:GGAZF, BMV SIX:GGAN.MX) would like to provide a corporate update on four recent
developments:
- Cascadia Goldfields Company Ltd. ("Cascadia") paid its second tranche payment of CAD$425,000 to
Goldgroup
- Warrants exercised - proceeds of CAD $821,720
- Paid off the Credipresto SAPI de CV SOFOM ENR ("Credipresto") Facility balance
- Oroco Resources Corp. ("Oroco") Promissory Note Amendment
I) Cascadia's second tranche payment to Goldgroup
Pursuant to the restructuring and sales agreement with Cascadia (see news release dated May 13,
2016), Cascadia has paid Goldgroup CAD $425,000, which was due on August 1, 2016. Cascadia will be obligated to make the following payments:
Due date
|
Payment
|
May 3, 2016
(received)
|
CAD $250,000 cash
|
August 1, 2016
(received)
|
CAD $425,000 cash
|
October 31, 2016
|
CAD $425,000 cash
|
December 30, 2016
|
CAD $400,000 cash
|
December 31, 2017
|
CAD $1,000,000 consists of
CAD $500,000 in
equity of Cascadia; and a
2.5% NSR beginning
on December 31, 2017 with a
capped payment of CAD $500,000.
|
Total
|
CAD $2,500,000
|
II) Warrants exercised
Pursuant to the Company's private placement in August 2014 (see news release dated August 12, 2014 and August 22, 2014), the Company is pleased to announce the
receipt of the following cash proceeds received from warrants exercised:
Expiration date
|
Warrants
outstanding
|
Exercise price
CAD$
|
Warrant
exercised
|
Percentage of
warrant
exercised
|
Proceeds
received by
Goldgroup
CAD$
|
August 11, 2016
|
2,767,955
|
$0.25
|
2,767,955
|
100%
|
$691,988.75
|
August 22, 2016
|
961,056
|
$0.25
|
482,925
|
50%*
|
$120,731.25
|
*The Company expects majority of the warrants remaining will be exercised, resulting an additional cash proceeds of
approximately CAD $110,000.
III) Credipresto Facility (the "Facility")
As at the date of this press release, the Company has fully paid off the Facility's principal and interest. The current balance
of the Facility is $nil.
IV) Oroco Resources Corp. ("Oroco") Promissory Note Amendment ("Amended Note")
The Company further amends the payment terms of the outstanding promissory note pursuant to the Cerro
Prieto property sale (see news release dated September 3, 2013 and September 29, 2015).
The following are the newly amended terms:
i)
|
CAD $100,000 paid to Oroco upon execution
of the Amended Note to settle the break fee under the previous promissory note terms (see September 29, 2015 news
release)
|
ii)
|
US$116,000 paid to Oroco to settle Oroco
IVA payable outstanding upon execution of the Amended Note. The balance of the Oroco IVA payable would be $nil upon
payment.
|
iii)
|
US$107,500 paid to Oroco towards the
outstanding principal and interest of the Promissory Note.
|
The Amended Note will have the following payment schedule ("Payment Schedule"):
Date
|
Amount (US$)
|
September 30, 2016
|
$25,000
|
October 31, 2016
|
$25,000
|
November 7, 2016
|
$200,000
|
December 30,
2016
|
$25,000
|
January 6, 2017
|
$200,000
|
February 28, 2017
|
$25,000
|
March 31, 2017
|
$25,000
|
April 30, 2017
|
$25,000
|
May 31, 2017
|
$25,000
|
June 30, 2017
|
Remainder of
balance
|
If Goldgroup fails to fulfill its obligation under the Payment Schedule:
i)
|
Goldgroup shall pay Oroco a break fee
equal to US$50,000; and
|
ii)
|
The new payment schedule will be revised
to US$75,000 payable at the end of each calendar month; and
|
iii)
|
The entire remaining principal balance
and interest will be payable on June 30, 2017.
|
As at the date of this news release, the outstanding principal and interest of the Amended Note was approximately US$798,700.
"Goldgroup has weathered the storm in these volatile times and successfully extinguished its significant debts and liabilities
to strengthen the balance sheet," said Keith Piggott, Chairman, President and CEO of Goldgroup,
"Goldgroup would like to use this opportunity to thank our business partners, loyal shareholders and the Company's employees for
their support in this challenging economic environment. With a stronger balance sheet and positive cash flow from Cerro Prieto, Goldgroup will continue to develop and de-risk its assets and look for growth opportunities in
the marketplace."
About Goldgroup
Goldgroup is a Canadian-based gold production, development, and exploration Company with a significant upside in a portfolio of
projects in Mexico, including a 50% interest in DynaResource de Mexico, S.A. de C.V., which owns 100% of the high-grade gold exploration project, San José de Gracia located in the State of Sinaloa. The Company also operates its
100%-owned Cerro Prieto heap-leach gold mine, in the State of
Sonora.
Goldgroup is led by a team of highly successful and seasoned individuals with extensive expertise in mine development, corporate
finance, and exploration in Mexico. Goldgroup's mission is to increase gold production, mineral
resources, profitability and cash flow, with a view to building a leading gold producer in Mexico.
For further information on Goldgroup, please visit www.goldgroupmining.com
On behalf of the Board of Directors,
Mr. Keith Piggott, Chairman and President
Tel: 1-520-247-5753
Investor Relations
Toll Free: 1-877-655-ozAu (6928)
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING INFORMATION
|
|
Certain information contained in this
news release, including any information relating to future financial or operating performance, may be considered
"forward-looking information" (within the meaning of applicable Canadian securities law) and "forward-looking statements"
(within the meaning of the United States Private Securities Litigation Reform Act of 1995). These statements relate to
analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and
assumptions of management. Actual results could differ materially from the conclusions, forecasts and projections contained
in such forward-looking information. These forward-looking statements reflect Goldgroup's current internal projections,
expectations or beliefs and are based on information currently available to Goldgroup. In some cases forward-looking
information can be identified by terminology such as "may", "will", "should", "expect", "intend", "plan", "anticipate",
"believe", "estimate", "projects", "potential", "scheduled", "forecast", "budget" or the negative of those terms or other
comparable terminology. Certain assumptions may have been made regarding the Company's plans at the Cerro Prieto project.
Many of these assumptions are based on factors and events that are not within the control of Goldgroup and there is no
assurance they will prove to be correct. Forward-looking information is subject to a variety of known and unknown risks,
uncertainties and other factors that could cause actual events or results to materially differ from those reflected in the
forward-looking information, and are developed based on assumptions about such risks, uncertainties and other factors
including, without limitation: uncertainties related to actual capital costs, operating costs and expenditures, production
schedules and economic returns from Goldgroup's projects; uncertainties associated with development activities;
uncertainties inherent in the estimation of mineral resources and precious metal recoveries; uncertainties related to
current global economic conditions; fluctuations in precious and base metal prices; uncertainties related to the
availability of future financing; potential difficulties with joint venture partners; risks that Goldgroup's title to its
property could be challenged; political and country risk; risks associated with Goldgroup being subject to government
regulation; risks associated with surface rights; environmental risks; Goldgroup's need to attract and retain qualified
personnel; risks associated with potential conflicts of interest; Goldgroup's lack of experience in overseeing the
construction of a mining project; risks related to the integration of businesses and assets acquired by Goldgroup;
uncertainties related to the competitiveness of the mining industry; risk associated with theft; risk of water shortages
and risks associated with competition for water; uninsured risks and inadequate insurance coverage; risks associated with
potential legal proceedings; risks associated with community relations; outside contractor risks; risks related to
archaeological sites; foreign currency risks; risks associated with security and human rights; and risks related to the
need for reclamation activities on Goldgroup's properties, as well as the risk factors disclosed in Goldgroup's Annual
Information Form and MD&A. Any and all of the forward-looking information contained in this news release is qualified
by these cautionary statements. Although Goldgroup believes that the forward-looking information contained in this news
release is based on reasonable assumptions, readers cannot be assured that actual results will be consistent with such
statements. Accordingly, readers are cautioned against placing undue reliance on forward-looking information. Goldgroup
expressly disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of
new information, events or otherwise, except as may be required by, and in accordance with, applicable securities
laws.
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SOURCE Goldgroup Mining Inc.