TORONTO, may 24, 2017 (GLOBE NEWSWIRE) — Mandalay Resources Corporation (“Mandalay” or the “Company”) (TSX:MND) announced today that Gold Exchange Limited (“GEL”), an independent company for the special purpose registered in Jersey, has entered into an agreement regarding a revised återköpserbjudande (“the Repurchase”) and a request for consent (the”Request for consent”) for its principal amount of eur 60 000 000 USD 5,875 % secured exchangeable bonds which expires in 2019 (the”Debentures”).
GEL issued the Debt securities in 2014 and loaned the proceeds to one of the Company’s subsidiaries in accordance with the terms of the loan agreement and the related financing agreement (the”Loan”), which together reflect the main terms of the Debt securities.
As stated in the mayor of mandalay press release from may 12, 2017, was not completed the initial repurchase offer and request for consent as GEL launched to the applicable Debt securities on april 19, 2017 (the “Originally proposed transaction”). But then started the GEL calls with the holders of the Debentures claim that the introduction of alternative arrangements in respect of the Debt securities which is largely similar to the Originally proposed transaction. Now, the holders of 100 %of the Debt securities issued a written decision approving the Repurchase and the request for consent with the same terms and conditions as the Initially proposed transaction, with the exception that the interest rate for the Debentures has been increased from 5,875 % per year to 6,875 % per year, with effect from the 13 may 2017. Also has GEL agreed to pay each holder of the Debentures a fee equal to 1.0% of the aggregate principal amount of the Debt securities held by it, which are not repurchased in accordance with the Repurchase.
In accordance with the Repurchase has GEL agreed to purchase a principal amount of the Debt securities on 29 950 000 USD from their holders at a price of 105 % of their principal amount, plus accrued and unpaid interest with a rate of 6,875 % per year for the period from (and including) 13 may 2017 to (but not including) the may 26, 2017. The repurchase is expected to be completed on may 26, 2017.
In connection to the Request for consent following changes have been made in the Loan conditions:
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extend the Loan maturity to 13 may 2022;
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remove one of the Loan conditions that required to GEL with the starting from the may 14, 2017, as additional security for the Debt securities, it would start depositing in a holding account, the aggregate number of shares in the SPDR Gold Trust, which could be given out in exchange for the Debt securities;
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the addition of a new clause to the Debt securities under which the GEL will be forced to offer a repurchase of a portion of the outstanding Debt securities, on the relevant date, if and to the extent that the retained guldekvivalenta ounce at the mayor of mandalay Costerfield-mine falls under the (initially) 232 000 guldekvivalenta ounces;
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a height of the interest payable on the Debentures, from 5,875 % per year to 6,875% per year.
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a lowering of the price of the Debt securities from 149,99 USD 135,00 USD.
Mandalay is required to fund any amounts that the GEL need to repurchase the Debentures in accordance with the Repurchase amount and all associated costs and expenses (including fees for consent). The outstanding amount of the loan has been reduced by an amount equal to the principal amount of the Debt securities repurchased in accordance with the Repurchase and the terms of the Loan have been changed to reflect, when applicable, changes in the Loan terms and conditions.
Mark Sander, President and Chief Executive Officer of Mandalay, commented, “We are pleased to have completed the revised återköpstransaktionen with the GEL. This revised agreement reduces our overall cost of skuldtjänster in the future, while also reducing the Company’s indebtedness and maintain its skuldnetto vis-à-vis the cash position of almost zero. To remove villkorsdepån for the loan is beneficial for the Company because it gives us full use of our cash and cash equivalents for the mervärdeinvesteringar in the future. The updated agreement extends the term of the loan for a further three years until 2022. With the sale completed, we have increased our capacity to finance growth through acquisitions or internal funding projects with an optimized mixture of the liquid assets, liabilities or equity.”
About Mandalay Resources Corporation:
Mandalay Resources is a canadian company that works with natural resources and has production assets in Australia, Sweden and the production as well as exploration projects in Chile. The company is focused on an acquisition strategy and to generate the necessary volume by adding projects, which are in a far developed stage or already in production in the gold, copper, silver and antimony in Australia, America and Europe to create short-term cash flow and value for shareholders.
Forward-looking statements:
This news release contains “forward-looking statements” within the meaning of applicable securities laws. These include statements regarding the company’s production of gold, silver and antimony for the fiscal year 2017. Readers are cautioned not to place too much emphasis and reliance on forward-looking statements. Actual developments and results may differ from those estimated in these statements, which, among other things, may be due to changes in commodity prices and general economic and market conditions. The factors identified above are not intended to constitute a complete list of the factors that could affect Mandalay. You will find a description of additional risks that could cause actual developments and results to differ from those estimated in the forward-looking statements in this news release under the heading “Risk Factors” in the mayor of mandalay annual report by 31 march 2017, of which there is a copy of the mayor of mandalay’s profile at
www.sedar.com
. In addition, it can never be guaranteed that the assets detected on the basis of additional drilling will be upgraded to proven or probable reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in the forward-looking statements, there may be other factors that cause actions, events or results not be as anticipated, estimated or intended. There is no assurance that the forward-looking statements will prove to be correct as actual results and future events could differ materially from those anticipated in these statements. Thus, readers should not place too much emphasis and reliance on forward-looking statements.
For more information:
Mark Sander
President and Chief Executive Officer
Greg DiTomaso
Director of Investor Relations
Contact:
+1 647.260.1566