THUNDER BAY, ON, Feb. 1, 2019 /CNW/ - Premier Gold Mines
Limited (PG: TSX) ("Premier" or the "Company") is pleased to
announce the closing of the previously announced US$50 million secured revolving term credit
facility with Investec Bank plc ("Investec"), as
administrative agent for the lenders thereunder (the "Investec
Credit Facility") and the previously announced financing
arrangements with OMF Fund II SO Ltd. and Orion Mine Finance
Fund II LP (collectively, "Orion") for aggregate gross proceeds
of approximately US$18.3 million.
Investec Credit Facility
The Investec Credit Facility matures in four years and will be
used for working capital requirements and general corporate
purposes. Amounts borrowed under the Investec Credit Facility will
bear interest at a variable rate per annum equal to LIBOR plus an
applicable rate as determined by the Company's debt to adjusted
EBITDA ratio for the immediately preceding fiscal quarter ranging
from 3.00% to 4.30%. The Investec Credit Facility is secured by the
assets relating to the South Arturo mine in Elko County, Nevada, U.S.A. ("South Arturo
Mine"), and the Mercedes mine in Hermosillo, Sonora, Mexico ("Mercedes
Mine"). Premier has not drawn-down under the Investec Credit
Facility.
Orion Financing Arrangements
In connection with the closing of the Orion financing
arrangements:
- Orion subscribed for seven (7) million common shares of Premier
(the "Private Placement") for aggregate gross proceeds of
approximately US$8.3 million or
approximately C$1.58 per common
share.
- Premier issued two (2) million common share purchase warrants
to Orion ("Orion Warrants"). Each Orion Warrant is
exercisable into one common share for a period of three (3) years
with an exercise price of C$2.05.
- an amended and restated silver stream agreement (the
"A&R Silver Stream Agreement"), amending and restating
the original agreement that was entered into on September 30, 2016, was entered into pursuant to
which:
-
- Orion paid an additional deposit of US$10 million to a wholly owned subsidiary of
Premier which will deliver to Orion 100% of the silver production
from the Mercedes Mine and 100% of the silver production from the
South Arturo Mine attributable to Premier until the delivery of
3.75 million ounces of silver (including deliveries previously made
to Orion), after which the delivery will be reduced to 30% of the
silver production from the Mercedes Mine and the South Arturo
Mine;
- Premier is required to deliver at least 300,000 ounces of
refined silver in each calendar year to Orion until 2.1 million
ounces of refined silver in aggregate have been delivered to Orion
after the date hereof;
- Orion will continue to pay an ongoing cash purchase price equal
to 20% of the prevailing silver price; and
- Orion has security over the assets relating to the South Arturo
Mine in addition to the Mercedes Mine.
- an amended and restated offtake agreement, amending and
restating Premier's existing offtake agreement with Orion, was
entered into to increase the annual gold sale quantity to 60,000
ounces of gold, subject to an annual aggregate maximum of 40,000
ounces of gold from each of (i) all of Premier's producing projects
(other than the Mercedes Mine) and (ii) the Mercedes Mine; and
- an amended and restated gold prepay credit agreement, amending
and restating the original agreement that was entered into on
September 30, 2016, was entered into
providing security to Orion over the assets relating to the South
Arturo Mine and providing Orion's consent to security changes at
the Mercedes Mine to facilitate the Investec Credit Facility.
The proceeds of the Private Placement and the additional deposit
paid pursuant to the A&R Silver Stream Agreement will be used
for the development, construction and working capital requirements
for the South Arturo Mine.
Premier Gold Mines Limited is a gold-producer with a
respected exploration and development pipeline of precious metal
projects in proven, accessible and safe mining jurisdictions in
Canada, the United States, and Mexico.
Investec Bank plc is an international specialist bank and
asset manager providing a diverse range of financial products and
services. Investec's Global Resources team offers a full service,
tailored offering and is active in precious and base metals,
minerals, oil and gas in both emerging and developed markets.
Investec has extensive experience in arranging and providing
financing for resource companies throughout North America and globally, supporting growth,
acquisitions and working capital.
For further details about Investec refer to:
https://www.investec.com/en_gb/corporate-finance/specialist-lending/resources.html
Orion Mine Finance is a mining-focused investment
business specializing in providing flexible capital investment
solutions to mining companies in the base and precious metals
sectors. Orion has demonstrated capability in debt, equity,
convertibles, offtake, streaming, and royalty investments. In
addition, the Orion team has experience in the physical metals
markets, such as facilitating the purchase, metal financing,
transporting, processing and selling of a mine's output to end
customers.
This Press Release contains certain information that may
constitute "forward-looking information" under applicable Canadian
securities legislation. Forward looking information includes, but
is not limited to, uses of proceeds, strategic plans, including
future operations at South Arturo Mine, and corporate and technical
objectives. Forward-looking information is necessarily based upon a
number of assumptions that, while considered reasonable, are
subject to known and unknown risks, uncertainties, and other
factors which may cause the actual results and future events to
differ materially from those expressed or implied by such
forward-looking information, including the risks inherent to the
mining industry, adverse economic and market developments and the
risks identified in Premier's annual information form under the
heading "Risk Factors". There can be no assurance that such
information will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
information. Accordingly, readers should not place undue reliance
on forward-looking information. All forward-looking information
contained in this press release is given as of the date hereof and
is based upon the opinions and estimates of management and
information available to management as at the date hereof. Premier
disclaims any intention or obligation to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by
law.
SOURCE Premier Gold Mines Limited