TIDMGRL
RNS Number : 8405E
Goldstone Resources Ltd
12 July 2021
12 July 2021
GOLDSTONE RESOURCES LIMITED
("GoldStone" or the "Company")
Operational Update
Settlement of Unsecured Bond Notes
Extension of Gold Loan Interest Payment
GoldStone Resources Limited (AIM: GRL), the West Africa focused
gold exploration and development company quoted on AIM, is pleased
to announce an operational update and agreements reached with
creditors.
Irrigation approval
Further to its announcement of 13 May 2021, the Company has
received approval from the Minerals Commission to start irrigation
and leaching of ore placed on the heap leach pad at the Homase
Mine. The Company remains on track to achieve the target production
of 25,000 ounces of gold for the first eight months of production,
with first gold pour expected to occur in Q3 2021.
Bond settlement
The Company has reached agreement for settlement of its twenty
outstanding unsecured bonds of US$50,000 each (the "Bonds") with
the holders of the Bonds (the "Bondholders").
The offer has been accepted by all Bondholders, who have agreed
to full and final settlement of the Bonds in exchange for the issue
of, in aggregate, 12,000,000 new ordinary shares of 1 penny each in
the capital of the Company ("Ordinary Shares") (the "Bond
Settlement Shares") (the "Bond Settlement Agreement"). Verbal
agreement has been received from BCM Investments Limited ("BCM"),
which will be allotted its 3,600,000 Bond Settlement Shares
immediately following signature of a written Bond Settlement
Agreement. A further announcement will be made in due course.
Settlement of the Bonds on the terms of the Bond Settlement
Agreement is deemed to be in the best interests of the Company and
all shareholders, as it avoids the issue of, in aggregate,
20,000,000 new warrants to subscribe for Ordinary Shares at an
exercise price of 3 pence per share, as well as the payment of
interest at a rate of 14% on the principal amounts outstanding.
Gold Loan
The Company is also pleased to announce that Asia Investments
Management Services Limited ("AIMS") has agreed a further extension
to the timing of payment of interest on the US$3 million secured
gold loan announced on 22 June 2020 (the "Gold Loan"), in relation
to which an extension to 30 June 2021 was agreed on 1 March 2021
due to delays experienced in respect of requisite operational
permits being issued.
AIMS has now agreed with the Company that all unpaid and accrued
interest associated with the Gold Loan to 30 June 2021 must be
repaid by 31 August 2021 (the "Extension"). Interest will continue
to accrue on the outstanding interest payment at the default rate
of 17% until payment is made.
Admission and Total Voting Rights
The Bond Settlement Shares will rank pari passu with the
existing Ordinary Shares and application will be made immediately
for 8,400,000 of the Bond Settlement Shares to be admitted to
trading on AIM ("Admission"). It is expected that Admission will
become effective and dealings in these new Ordinary Shares will
commence at 8.00 a.m. on 16 July 2021.
On Admission, Paracale Gold Limited ("Paracale Gold"), which
currently holds 102,704,754 Ordinary Shares in GoldStone,
representing 24.93% of the Company's current issued share capital,
will hold 106,304,754 Ordinary Shares representing 25.29% of the
Company's enlarged share capital.
Upon Admission, the Company's issued ordinary share capital will
consist of 420,338,344 Ordinary Shares with one voting right each.
The Company does not hold any Ordinary Shares in treasury,
therefore the total number of Ordinary Shares and voting rights in
the Company on Admission will be 420,338,344 . With effect from
Admission, this figure may be used by shareholders in the Company
as the denominator for the calculations by which they will
determine if they are required to notify their interest in, or a
change to their interest in, the share capital of the Company under
the FCA's Disclosure Guidance and Transparency Rules.
Emma Priestley, CEO of GoldStone, commented :
"I am delighted that the Bond Holders and AIMS have been
supportive to the Company to avoid impacting the Company's
operational progress, allowing us to continue to focus on moving
towards our target of near-term gold production."
Related Party Transactions
AIMS, Paracale Gold and BCM are substantial shareholders of the
Company, holding 29.62%, 24.93% and 12.14% respectively, and are
therefore related parties of the Company as defined in the AIM
Rules for Companies ("AIM Rules").
Accordingly, the Bond Settlement Agreement entered into with
Paracale Gold and the Extension of the Gold Loan with AIMS, are
deemed to be related party transactions pursuant to Rule 13 of the
AIM Rules and the independent directors, being Emma Priestley,
Richard Wilkins and Orrie Fenn, consider, having consulted with the
Company's nominated adviser, Strand Hanson Limited, that the terms
and conditions of the Bond Settlement and Extension are fair and
reasonable insofar as the shareholders of the Company are
concerned. BCM is a significant shareholder in the Company and the
entering into of the Bond Settlement Agreement with BCM will be a
related party transaction.
- ENDS-
For further information, please contact:
GoldStone Resources Limited
Bill Trew / Emma Priestley Tel: +44 (0)1534 487 757
Strand Hanson Limited
James Dance / James Bellman Tel: +44 (0)20 7409 3494
S. P. Angel Corporate Finance
LLP
Ewan Leggat / Charlie Bouverat Tel: +44 (0)20 3470 0501
About GoldStone Resources Limited
GoldStone Resources Limited (AIM: GRL) is an AIM quoted
exploration and development company with projects in Ghana that
range from grassroots exploration to development.
The Company is focused on developing the Akrokeri-Homase project
in south-western Ghana, which hosts a JORC Code compliant 602,000
oz gold resource at an average grade of 1.77 g/t. The existing
resource is confined to a 4km zone of the Homase Trend, including
Homase North, Homase Pit and Homase South.
The project hosts two former mines, the Akrokerri Ashanti Mine
Ltd, which produced 75,000 oz gold at 24 g/t recovered grade in the
early 1900s, and the Homase Pit which AngloGold Ashanti developed
in 2002/03 producing 52,000 oz gold at 2.5 g/t recovered. It is the
Company's intention to build a portfolio of high-quality gold
projects in Ghana, with a particular focus on the highly
prospective Ashanti Gold Belt.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 as it forms part of
United Kingdom domestic law by virtue of the European Union
(Withdrawal) Act 2018.
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